There is a lot of leg work and activity that goes into creating a movement so the consumer is prepared to deal with different conflicts, he added.
“Many of our institute members are in private wealth and are RIAs [registered investment advisors] and operate under a fiduciary standard and they feel disappointed that brokers can provide the same advice they provide, not operate with a fiduciary standard, but now tell consumers ‘We’re operating in your best interest,’” Schacht said.
It remains to be seen whether or not investors will have a clearer understanding of whether they’re working with a broker or an RIA once the Reg BI package of rules goes into effect in June, 2020. Several groups, including the SEC’s own Investor Advocate, did surveys and studies that have shown investors were confused by Reg BI and its disclosures.
While outside law firms are working to get firms into regulatory compliance with the rule “we have yet to see a lot in terms of its effects whether relationship with investors has changed and investors feel they’re getting a clearer feel if the person sitting across from them is a sales person or a regulated fiduciary,” Schacht said.
“We don’t think there is enough in this rule to clear that up,” he added.