Investment advisers and stockbrokers should be subject to the same fiduciary standard of conduct — putting a customer’s interests above their own — rather than the different governance regimes that currently apply to the two groups, the Securities and Exchange Commission recommended on Saturday.
In a report closely watched by Wall Street, the commission’s staff said retail investors “generally are not aware” that stockbrokers and their firms are subject to a lesser legal standard, one that requires brokers to make sure the products that they sell are suitable for their clients. Investment advisers are already subject to the higher fiduciary standard.
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