Clients often receive both advisory and brokerage services through a hybrid advisor, FSI said, and so broker-dealers “have an interest in taking the same holistic view towards investor protection in respect of these clients.”
Brokerage firms also said Finra needs to offer more guidance for what constitutes reasonable supervision under the plan.
The Finra plan is part of a retrospective review of rules begun in 2017 under Finra chief Robert Cook.
Finra could still amend the plan, which in any case would require SEC approval before being implemented.