Amy Longo Comments on SEC Action on Best Interest Rule in Bloomberg

The SEC’s Regulation Best Interest (Reg BI) rule, which requires broker-dealers to recommend only products that are in retail customers’ best interests, took effect several years ago but has been lightly enforced. But with an uptick in SEC recent staff bulletins on the rule, firms need to assess compliance with care obligations, and more closely examine for example whether less complex investment products could achieve the same results for clients as higher risk ones.

Litigation & enforcement partner Amy Jane Longo told Bloomberg, “By calling that out specifically, the [SEC] staff is indicating that those areas will be a focus both in exams and potentially in enforcement matters to come.”