SEC chief: ‘It’s beyond time’ for new rules on financial advisers

Securities and Exchange Commission (SEC) Chairwoman Mary Jo White on Tuesday suggested her agency will act on new regulations for financial advisers and broker-dealers, though she did not provide a timetable.

“It’s beyond time to act in that space,” White said at a forum hosted by the Securities Industry and Financial Markets Association (SIFMA) in Phoenix. “[But] it’s not an easy road, it’s not a quick road.”

White said that she has been “extensively studying” the issue in recent months.

{mosads}Officials at the White House and the Department of Labor (DOL) are pushing new “fiduciary standards” for financial advisers and broker-dealers, but the effort is meeting vocal opposition from Wall Street.

DOL and SEC officials have different jurisdiction in regulating the financial-advice markets, which industry groups say could create compliance headaches if two different sets of rules are drafted.

The Obama administration and liberal groups argue the disclosure requirements are needed to better protect consumers from faulty financial advice. But Republican and centrist Democratic critics, backed by the business community, argue the rules would prevent low-income Americans from obtaining financial advice.

Republicans have criticized Labor Department officials for not coordinating with the SEC on drafting the regulations.

White did not address a House Republican bill that would require the SEC to propose a rule before the Labor Department does to ensure that there will not be market confusion.

“SEC staff provided really extensive, technical assistance to the Department of Labor,” White said. “In the end, we are separate agencies and we have separate mandates. Everybody would want us to consult and be as consistent as we can in that space but at the end of the day, we have to do each of us what we think is the right thing to do for our mission and statutory mandate.”

White seemed to signal that she hears the business community’s concerns about creating regulations that would limit low-income Americans’ access to financial advice.

“Getting the balance right is absolutely essential,” White said. “At the end of the day, if what we succeed in doing is in effect depriving investors of reliable reasonably priced advice, obviously we will have failed in that effort.”