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30 Rev. Banking & Fin. L. 123 (2010-2011)
The Regulation of Brokers, Dealers, Advisers and Financial Planners

handle is hein.journals/annrbfl30 and id is 139 raw text is: THE REGULATION OF BROKER-DEALERS THE REGULATION OF BROKERS, DEALERS, ADVISERS AND FINANCIAL PLANNERS TAMAR FRANKEL I. Introduction Congress has given the Securities and Exchange Commis- sion (Commission) some serious homework in the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act).' First, the Commission is required to study the standards of care for brokers, dealers and advisers and consider the elimination of the broker exclusion from the Advisers Act of 1940 (Advisers Act).2 In addition, the Commission must evaluate the impact of imposing on brokers the duties of the Advisers Act.3 That imposition would include the duty of loyalty, acting for the best interests of the clients and avoiding conflicts of interest.4 I will deal summarily with the differences between the duties currently imposed on advisers and brokers and their origins. I note that in today's financial world there are individual brokers, broker-dealers, advisers and financial . Professor of Law and Michaels Faculty Research Scholar, Boston University. 1 Dodd-Frank Wall Street Reform and Consumer Protection Act, Pub. L. No. 111-203, 124 Stat. 1376 (2010). 2 Id. at §§ 913(b)(1)-(2) (The Commission shall conduct a study to evalu- ate . . . the effectiveness of existing legal or regulatory standards of care for brokers, dealers, [and] investment advisers .. . [and] whether there are legal or regulatory gaps, shortcomings, or overlaps in legal or regulatory standards in the protection of retail customers relating to the standards of care for brokers, dealers, investment advisers.). 3 Id. at §§ 913(c)(9)-(9)(A) (stating that the Commission shall consider the potential impact of imposing upon brokers, dealers, and persons associ- ated with brokers or dealers . . . the standard of care applied under the Investment Advisers Act of 1940). 4 Id. at §913(g)(1) (stating that the Commission may promulgate rules to establish a fiduciary standard for broker-dealers, including requirements to act in the best interest of the customer without regard to the financial or other interest of the broker, dealer, or investment adviser providing the advice[, that] . . . any material conflicts of interest shall be disclosed[, and that the] . . . standard of conduct shall be no less stringent than the standard applicable to investment advisers under section 206(1) and (2) of this Act when providing personalized investment advice about securities . . ). 2010-2011 123

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