Skip to main content

You are here


The SEC (Re)Enters the Fiduciary Fray

In affirming the June 9 applicability date of the fiduciary regulation, Secretary of Labor Alexander Acosta expressed a desire for the Securities and Exchange Commission to reengage on the issue. It looks like he’s going to get his wish.

As part of a call for public comment, new SEC Chairman Jay Clayton noted that the Department of Labor’s fiduciary rule “may have significant effects on retail investors and entities regulated by the SEC,” and “also may have broader effects on our capital markets” – and that “many of these matters fall within the SEC's mission of protecting investors; maintaining fair, orderly, and efficient markets; and facilitating capital formation.”

He then said that he welcomed the Labor Department’s invitation to “engage constructively” as the SEC moves forward with its examination of the standards of conduct applicable to investment advisers and broker-dealers and related matters. “I believe clarity and consistency — and, in areas overseen by more than one regulatory body, coordination — are key elements of effective oversight and regulation,” he wrote.

“Retail investors” shows up repeatedly in the letter and in the long list of potential areas for comment contained therein – but “retirement” is mentioned only once, early on: “Given the significance of these issues — in particular, for retail investors looking to save for the things that matter most to them, including homeownership, education, and retirement — I look forward to robust, substantive input that will advance and inform the SEC's assessment of possible future actions.”

Clayton noted that there had been “significant developments in the marketplace since the Commission last solicited information from the public in 2013,” citing “financial innovations, changes to investment adviser and broker-dealer business models, and regulatory developments — including the issuance and pending applicability of the Department of Labor’s Fiduciary Rule.” Clayton went on to state that, “In light of these developments, I believe an updated assessment of the current regulatory framework, the current state of the market for retail investment advice, and market trends is important to the Commission’s ability to evaluate the range of potential regulatory actions.”

Clayton then referenced an online form and email box “for members of the public to make their views on these issues known publicly in advance of any future Commission action,” and proceeded to outline a long list of questions – in addition to whatever information is on the public’s mind – that he is seeking input on.