The Securities and Exchange Commission plans to propose new rules this year to crack down on the behavioral prompts and data analytics used by some online stock brokerages and investment advisers.
The agency’s bid to impose restrictions on trading and investing apps popular with retail traders follows a review by the SEC of “digital engagement practices,” which critics refer to as the gamification of investing. Wall Street’s main regulator said last August that it was concerned that game-like features are putting investors at risk by encouraging excessive trading.
The rule plan, which was announced this week in a calendar of upcoming regulatory actions, could pose significant challenges for online brokerages and advisers. Under SEC rules, if a firm is offering investment advice or recommending securities it can face conduct standards that require putting clients’ interests first.
Since taking over in April 2021, SEC Chair Gary Gensler has raised concerns with how features closely associated with the mobile phone apps offered by brokers such as Robinhood Markets Inc. and Webull Financial can impact trading. He’s also questioned whether big data in finance may create conflicts of interests for brokers and advisers, and whether digital nudges on a trading app can amount to offering a recommendation.
In a statement, Robinhood said it looked forward to engaging with the regulator and that “it’s important not to conflate gamification with simple, intuitive design” which has made investing more accessible. Webull didn’t immediately respond to a request for comment.
In a separate announcement, the SEC said it’s considering proposing new rules on credit ratings agencies’ potential conflicts of interests.
The new regional leader brings nearly 25 years of experience as the firm seeks to tap a complex and evolving market.
The latest updates to its recordkeeping platform, including a solution originally developed for one large 20,000-advisor client, take aim at the small to medium-sized business space.
Crypto investor argues the federal agency's probe, upheld by a federal appeals court, would "strip millions of Americans of meaningful privacy protections."
Meanwhile in Chicago, the wirehouse also lost another $454 million team as a group of defectors moved to Wells Fargo.
The broker-dealer giant's latest acquisition agreement extends its push towards offering enhanced financial planning and investment management.
Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.
Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.
