(September 2020)

There has been a lot of consternation about the new DOL fiduciary rule. Some of it from brokers, more of it from fiduciaries and investor protection groups. What has been much less covered, however, is the insidious rise of state level fiduciary rules that are threatening to create a national patchwork of regulations that could isolate the industry into little islands. Therefore, the introduction last week of a new fiduciary rule for Massachusetts is a big deal. It comes on the heels of nearly a dozen other state fiduciary rule proposals and highlights that many states are unsatisfied with the new federal rule and still want to take matters into their own hands.


FINSUM + Magnifi: In our view, this is a really big deal. It highlights the fact that many states will still not be satisfied with federal efforts, and thus there are likely to be more fiduciary rules forthcoming on a state by state basis. If that comes to pass, it would create a regulatory nightmare and significantly limit advisors from doing national business.


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