SEC chairman Jay Clayton defends advice rule

SEC chairman Jay Clayton defends advice rule
He strikes back at critics including Elizabeth Warren, who called the new rule a gift to Wall Street.
JUL 09, 2019

U.S. Securities and Exchange Commission chairman Jay Clayton is striking back at critics who've said one of his signature regulatory achievements is a gift to Wall Street. The rules in question, passed by the SEC last month, were supposed to clamp down on broker conflicts of interest. But Sen. Elizabeth Warren, the Massachusetts Democrat running for president, said the reforms will make it even easier for financial firms to cheat consumers, while House Financial Services Committee chairwoman Maxine Waters urged the SEC to rescind them. In a speech Monday, Mr. Clayton, a former Wall Street deals lawyer appointed by President Donald J. Trump, rejected the attacks. He called the objections "false, misleading" and in some cases, "policy preferences disguised as legal critiques." Speaking from Boston, Mr. Clayton ticked through what he said were seven false claims made about the rules. At one point, he dismissed contentions that the regulations lower the so-called fiduciary duty that investment advisers must adhere to. "I recognize that some interest groups would have preferred a different approach," Mr. Clayton said at a speech hosted by Babson College's Stephen D. Cutler Center for Investments and Finance. "But, after careful consideration, our approach addresses multiple, interrelated issues in a way that best achieves our goals of enhancing investor protection and decision making, while — again — preserving your access and choice." The fight over setting a code of conduct for brokers has been going on in Washington for more than a decade. The SEC's regulations, approved in a 3-1 vote on June 5, impact tens of millions of investors who buy stocks and bonds as they save for retirement, new homes and college.

Latest News

WallStreetBets takes on the SEC — and makes a surprisingly sharp case
WallStreetBets takes on the SEC — and makes a surprisingly sharp case

The Reddit trading community's formal comment letter against the proposal is drawing widespread attention across finance and tech circles.

Stratos Wealth Holdings closes 11 acquisitions in push for advisory scale
Stratos Wealth Holdings closes 11 acquisitions in push for advisory scale

RIA aggregator adds $4.8 billion in client assets across seven states as demand grows for alternatives to traditional succession models.

Beyond wealth management: Why the future of advice is becoming more human
Beyond wealth management: Why the future of advice is becoming more human

As technical expertise becomes increasingly commoditized, advisors who can integrate strategy, relationships, and specialized expertise into a cohesive client experience will define the next era of wealth management

Shareholder sues FS KKR Capital board, alleges NAV and dividend cover-up
Shareholder sues FS KKR Capital board, alleges NAV and dividend cover-up

Shareholder targets FS KKR Capital's directors over alleged portfolio valuation and dividend missteps.

UBS loses $1.2 million arbitration claim linked to variable annuities and margin
UBS loses $1.2 million arbitration claim linked to variable annuities and margin

UBS has a history of costly litigation stemming from the sale of volatile investment products.

SPONSORED Beyond wealth management: Why the future of advice is becoming more human

As technical expertise becomes increasingly commoditized, advisors who can integrate strategy, relationships, and specialized expertise into a cohesive client experience will define the next era of wealth management

SPONSORED Durability over scale: What actually defines a great advisory firm

Growth may get the headlines, but in my experience, longevity is earned through structure, culture, and discipline