U.S. securities industry lobbyists indicate that they continue to support the idea of adopting a common standard of care for anyone providing financial advice.

The Securities Industry and Financial Markets Association said Monday it has submitted comments to the U.S. Securities and Exchange Commission in anticipation of SEC’s study on the obligations of investment advisors and broker dealers.

As part of U.S. regulatory reform, the SEC is to study whether to extend fiduciary obligations, which currently only apply to investment advisors, to broker dealers, too. In the past, SIFMA has supported the introduction of a uniform federal fiduciary standard of care for advisors and brokers. And, it reiterates that position in its letter to the SEC.

“It’s time for all those who provide personalized investment advice to individual investors to be held to a uniform standard of care,” said Ira Hammerman, senior managing director and general counsel at SIFMA. “We’ve asked the SEC to provide a clear definition of any uniform standard of care that it adopts and preserve individual investor choice and access to the advice, services and products they want and deserve.”

In the comment letter, SIFMA calls on the SEC to clearly define the common standard, and provide guidance regarding how this duty can be satisfied by broker-dealers, “when they offer the wide range of products and services that today are not offered under the investment advisor model. This duty will be satisfied in a different manner for a fully discretionary trading account than for a trade-by-trade recommendation of an individual security, for example.”

In comments, SIFMA highlights principles that it believes the commission should focus on during its study; including that broker-dealers and investment advisors should deal fairly with clients when providing personalized investment advice to individual investors; that they should provide individual investors with full disclosure that is simple and clear; and that investors should continue to have access to a wide range of investment products and services, choice among financial service providers and their options for paying for financial services.

Finally, it says that any standard of conduct adopted by the SEC “should reduce confusion” by being a uniform standard that applies to brokers and investment advisors when providing personalized investment advice about securities to individual investors.

IE