Investment Services Regulatory Update –

New Rules, Proposed Rules, Guidance and Alerts –

New Rules –

SEC Adopts Rules and Interpretations Concerning the Standard of Conduct for Broker-Dealers and Investment Advisers -

On June 5, 2019, the SEC adopted a package of rules and interpretations addressing standards of conduct for brokerdealers and investment advisers:

- Regulation Best Interest. Regulation BI establishes a standard of conduct for broker-dealers when making an investment recommendation to a “retail customer” involving securities. Regulation BI includes specific obligations concerning disclosure, standard of care, conflicts of interest and compliance, requiring a brokerdealer to:

(1) act in the best interest of its retail customer at the time a recommendation is made, without placing the broker-dealer’s own interests ahead of its client’s interests; and

(2) address conflicts of interest by establishing policies and procedures to identify and disclose, and in certain circumstances mitigate or eliminate, conflicts of interest.