|  | | 2010 News and Press Releases | | |
HEADLINE NEWS:
SEC Study Gains Upper Hand In Fiduciary-Standard Battle, As Debate Gets Under Way, Language In Senate Bill To Be Jumping-Off Point
Mark Schoeff Jr.
InvestmentNews. June 6, 2010
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EXCERPT: When Capitol Hill negotiations on landmark financial-regulatory-reform legislation begin in earnest this week, proponents of putting a universal fiduciary standard in the final bill must overcome a head start that backers of a weaker provision have gained. The House bill directs the Securities and Exchange Commission to write a rule imposing the same standard of care on broker-dealers and insurance agents that applies to investment advisers when giving personalized investment advice. The Senate bill would delay such a regulation until after congressional review of an SEC study. The Senate language, which fiduciary advocates oppose, is starting in the pole position as talks get under way. “We understand that the base text that will be used in the conference is the Senate bill text,” said David Bellaire, general counsel and director of government affairs for the Financial Services Institute, which supports the push for a study. “That creates a slight advantage for the Senate provision to remain in place.” The House-Senate conference committee will reconcile the versions of the bill passed by each chamber — the Senate last month and the House last year. After Congress approves a final bill, it will be sent to President Barack Obama to be signed into law. Democratic leaders want to get the legislation on the president's desk by July 4. That puts a tight time frame on negotiators, who will have to address many differences — some of them major — in a bill that totals more than 1,500 pages. Throughout the legislative process, the fiduciary standard has been overshadowed by larger issues such as curbing excesses by “too big to fail” institutions, establishing a consumer protection agency, reforming derivatives trading and addressing systemic risk. During consideration of the financial-reform bill last month on the Senate floor, fiduciary amendments never came up for a vote. |
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