Regulators at the Financial Industry Regulatory Authority will focus on recommendations to shift retail investors from brokerage accounts to advisory accounts in 2018, according to a recently released regulatory and exam priorities letter.
Previous exam priorities have not included a focus on recommendations to move to fee-based accounts.
Under rule 2111 of FINRA's regulatory manual, which establishes the so-called suitability standard, brokerages and registered members must have a "reasonable basis to believe that a recommended transaction or investment strategy involving a security or securities is suitable for the customer."
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Nick Thornton
Nick Thornton is a financial writer covering retirement and health care issues for BenefitsPRO and ALM Media. He greatly enjoys learning from the vast minds in the legal, academic, advisory and money management communities when covering the retirement space. He's also written on international marketing trends, financial institution risk management, defense and energy issues, the restaurant industry in New York City, surfing, cigars, rum, travel, and fishing. When not writing, he's pushing into some land or water.
