'Rubbish': Advisors, firms trade barbs over SEC's best interest rule
Industry insiders and the investing public are telling the SEC just what they think of the regulator's proposed Regulation Best Interest.
It's "rubbish," an advisor says.
And that is one of the less-heated responses.
Clashes over the Department of Labor's fiduciary rule have carried over into the debate on the SEC's proposal, also known as Reg BI, which the commission put forward earlier this year.
Several industry trade groups and firms threw their support behind the SEC's proposed regulation, but indicated areas where the commission should rethink its approach. Restricting titles, they said, would do little to reduce client confusion about the intricacies of the industry. LPL Financial suggested that such a proposal would "inevitably spawn a proliferation of new titles that would contribute equally to investor confusion."
Fiduciary advocates criticized the SEC proposal as ineffective policy at best, knocking it for its reliance on disclosure to protect investors.
Clients don't read complicated prospectuses, advisor Ethan Baird noted. What makes the SEC think complicated disclosure documents are the answer?
More than 3,800 investors, advisors, firms, advocacy groups and others filed comments to the commission, according to data posted on the SEC's website. With the comment period closed, the SEC will review the feedback and consider whether to make changes, if any, to the proposal before putting it to a vote before its commissioners.
Scroll through to see a sampling of the most provocative and thoughtful feedback the regulator received.