SEC to propose “best interest” standard | KPMG | US
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SEC to propose “best interest” standard, retail customer protection

SEC to propose “best interest” standard

The U.S. Securities and Exchange Commission (SEC) on April 18, 2018, voted to propose a package of rulemakings and interpretations requiring a broker-dealer to act in the best interest of a retail customer when making a recommendation of any securities transaction or recommending an investment strategy involving securities to a retail customer.

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According to an SEC release, the proposals will be designed “to enhance the quality and transparency of investors’ relationships with investment advisers and broker-dealers while preserving access to a variety of types of advice relationships and investment products.”

The SEC proposals are to be published in the Federal Register and then subject to a 90-day comment period.

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