The fiduciary duty should extend to all broker-dealers when they offer investment advice about securities to retail customers, said a group of advisors, financial planners and consumer advocates in a letter to the Securities and Exchange Commission last week.
The letter, whose signatories included the Investment Adviser Association, the AARP, the Consumer Federation of America and the Financial Planning Association, among others, was addressed to SEC Chairwoman Mary Shapiro was an effort to weigh in on extending the Investment Advisers Act of 1940 to all broker-dealers.
The groups support the SEC staff study in January 2011 that would adopt parallel rules imposing a fiduciary duty on broker-dealers, including those in the broker-dealer units of insurance companies selling proprietary products, and investment advisers is consistent with the Dodd-Frank Act.
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