Will Reg BI Be Hammered by Lawsuits?
June 10, 2019 by Melanie Waddell
Industry officials anticipate a little-changed Regulation Best Interest as well as potential lawsuits after the Securities and Exchange Commission approves on Wednesday its controversial Reg BI for brokers, part of the agency’s four-pronged advice standards package.
“Litigation is certainly possible after the final rules are adopted,” said David Tittsworth, former president and CEO of the Investment Adviser Association who’s now an attorney with Ropes & Gray in Washington.
Before lawsuits are filed, however, Tittsworth said he expects “a lot of plain old legal digging — including [of] those all-important footnotes — to try to figure out what the new rules require and what changes will be required by brokers, investment advisors and dual registrants to comply with the new rules.”
Word on the street a day before the SEC vote is that Reg BI will be only modestly changed from the proposal floated last April.
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