Learn more about the SEC’s proposed advice standards

Learn more about the SEC's proposed advice standards

Skip Schweiss | July 25, 2018

We doubt most RIAs have the time to consume and digest proposals that total nearly 1,000 pages, so we asked a leading authority on advisor regulation to boil down some of the more important aspects to just 10 pages – a 99 percent reduction!

Hard to believe it’s been more than 13 years since TD Waterhouse submitted a comment letter to the Securities and Exchange Commission expressing its concerns about the “Merrill Lynch Rule,” which allowed brokers to charge fees for brokerage accounts yet not answer to fiduciary obligations under the ‘40 Act.

When the Merrill Rule was overturned by the courts in 2007, an important competitive advantage was preserved for registered investment advisers (RIAs) while, around the same time, TD Waterhouse combined with Ameritrade to create TD Ameritrade. We‘ve been fighting by the side of RIAs ever since.

Part of our commitment to RIA advocacy is keeping clients like you informed of key policy developments that can impact your business. Recently, the SEC proposed a landmark series of rules that could redefine the competitive landscape for years to come.

The three-part package announced April 18, 2018, includes proposals to:

Raise the standard of care for broker-dealers, known as Regulation Best Interest

Enhance disclosures to clients of both broker-dealers and RIAs through a standardized client relationship summary — Form CRS

Clarify and revise the regulations applicable to RIAs, entitled “Proposed Commission Interpretation Regarding Standard of Conduct for Investment Advisers”

The SEC has invited the public to submit comments, but we doubt most RIAs have the time to consume and digest proposals that total nearly 1,000 pages. So we asked a leading authority on advisor regulation, Fred Reish of Drinker Biddle & Reath LLP, to boil down some of the more important aspects to just 10 pages – a 99 percent reduction!

We encourage RIAs to read this brief summary so that you may have a better understanding of what is being proposed, how it may affect your firms and, should you want, submit feedback to the SEC. The deadline for comments is August 7.

We hope you do and we also hope you will share your thoughts and concerns with us. Drop us a line, and take a moment to answer a five-question survey

As always, we at TD Ameritrade Institutional want to make sure you have a seat at the policy-making table to help ensure the viability of the RIA profession far into the future, for the benefit of you and your clients.

Skip Schweiss is Managing Director, Advisor Advocacy and Industry Affairs, at TD Ameritrade Institutional. He is also President, TD Ameritrade Trust Company.