Recently, the NJ Bureau of Securities announced that they will begin soliciting comments regarding amendments to its rules to require that broker-dealers, agents, investment advisers, and investment adviser representatives be subject to a fiduciary duty.
As such, we are seeking feedback from our membership on the impact that this change would have on their businesses. To submit any comments or feedback you may have on the pre-proposal, please reach out to me at AMusick@njbia.org.
The Bureau is considering making it a dishonest or unethical business practice for failing to act in accordance with a fiduciary duty when recommending to a customer, an investment strategy, or the purchase, sale, or exchange of any security or securities, or providing investment advisory services to a customer.
The Bureau believes that this uniform standard protects investors against the abuses that can result when financial professionals place their own interests above those of their customers. The Bureau has invited comment on the legal and factual bases for applying a fiduciary standard to all financial services professionals; the scope of the duty in terms of duration and when it arises; the types of recommendations that would trigger the duty; and the scope of the duty in terms of to whom it is owed.
Additionally, the Bureau of Securities will hold two informal conferences to take testimony from interested parties to gather facts to inform rulemaking and provide opportunity for public comment. For more information on the pre-proposal, the conferences, or the comment process please click here.