AARP In Brief: Protecting Investors—Establishing the SEC Fiduciary Duty Standard

Many broker-dealers are not subject to a fiduciary duty when they provide personalized investment advice to their clients. Broker-dealers regularly provide investment advice, but not all of these broker-dealers are subject to the federal fiduciary duty that applies under the Investment Advisers Act of 1940. This anomaly has led to calls to regulate broker-dealers under the Advisers Act, or at least to impose a fiduciary duty on broker-dealers when they provide investment advice. Historically, the brokerage industry has opposed imposing a fiduciary duty on broker-dealers that are not subject to the act.
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