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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

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
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 . . ).



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