Maryland is the latest state to advance a proposal to set a uniform fiduciary standard for broker-dealers and advisors.
Lawmakers in the Old Line State join those from Nevada and New Jersey who are
Maryland’s sweeping consumer protection bill includes language that would define an array of financial professionals as fiduciaries and require them "to act in the best interest of the customer without regard to the financial or other interest of the person or firm providing the advice."
The proposal would extend fiduciary responsibilities to broker-dealers, their agents and insurance providers, as well as investment advisors and their reps.
The legislation authorizes the state Commissioner of Financial Regulation to draft regulations defining fiduciary do’s and don'ts for covered entities. It also stipulates that it would not add any new requirement for broker-dealers regarding their books and records beyond what is already mandated under federal regulations.
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New York legislators are set to reconsider a previously stalled fiduciary bill.
November 7 -
A handful of states are pushing their own advisor regulations, potentially setting up a legal showdown.
February 4 -
State regulators and state legislature are stepping in to propose initiatives to protect consumers against salespeople wrapped in fiduciary clothing.
February 4
The current crop of state fiduciary proposals began in response to the collapse of the Department of Labor's rule on retirement advice. The movement has gathered steam despite the SEC's proposal for a regulation to require brokers to act in their clients' best interest although it would not impose a full-throated fiduciary duty.
Those proposals have sparked fierce opposition from industry members, who are urging the states to defer to the SEC as it moves toward finalizing its best interest regulation.
“We have long held the position that the SEC is the appropriate agency to develop a uniform standard of care," Michelle Carroll Foster, FSI's vice president for state affairs, recently told Financial Planning, warning that states going in their own direction could "create a patchwork of rules across the country."
