By Investment News reporter Mark Schoeff

Acting in a client’s best interest is a principle that most financial advisers say they live by. But the advice industry is unlikely to know how a new regulation based on that principle will work until it is enforced more than a year from now.

Although the Securities and Exchange Commission approved in June an advice reform regulatory package highlighted by Regulation Best Interest to raise the broker standard above suitability, there are still a lot of questions surrounding the changes.

The SEC established the principle — brokers must not place their own interests ahead of their clients’ interests — but didn’t fill in the details. For instance, there is no definition of best interest in the measure, nor is there a roadmap on how to mitigate conflicts.

No one will no know what Reg BI really means until the SEC says so through exams and enforcement.

Read the full Investment News story here: https://www.investmentnews.com/article/20191001/FREE/191009993/brokerages-wont-know-bite-of-reg-bi-until-enforcement-begins