Massachusetts regulator mulls greater fee disclosure

State-registered RIAs would have to provide fee table for greater transparency

Feb 8, 2018 @ 10:39 am

By InvestmentNews

Securities regulators in Massachusetts are asking for comments on a proposed regulation that would require investment advisers registered with the state to create a fee table to be given to new and existing advisory clients.

"Recent changes that have occurred in the financial services industry, many fueled by fintech innovations, have resulted in an evolving fee structure for investment advisers," William F. Galvin, Secretary of the Commonwealth, said in a release.

"It is no longer the case that advisers only charge their clients a fee for assets under management. It is not uncommon today for consumers to pay different types of fees for advisory services, including retainer fees, subscription fees, or third-party robo-advisers fees," he said.

The proposed table is intended to address these new compensation models by providing fee transparency. The table is also intended to enable customers to comparison shop among advisers," he said.

After the initial comment period, the state's securities division anticipates that a formal solicitation of comments will follow.

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