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ADISA Co-Signs Letter to Nevada Securities Administrator Regarding SB 383

Jun 26, 2017

ADISA has joined major financial services trade associations and companies in co-signing a letter to the Nevada Securities Administrator regarding implementation of the recently signed bill, SB 383. This legislation, signed by Nevada’s governor on June 2, removes the exemption for broker-dealers (BDs), investment advisers (IAs) and sales representatives from the definition of “financial planner” in NRS 628A, thereby extending financial planner-specific duties and liabilities to them.
 
As the Securities Administrator’s office begins the drafting process, the letter lays out a few preliminary thoughts for consideration:
 

  1. The new law has a July 1 effective date. Co-signers of the letter respectfully request that Nevada either delays the implementation date or makes clear that, until regulations are finalized, compliance with existing FINRA and SEC requirements is deemed sufficient.
  2. A deliberative approach will take some time. Regulations should be built upon federal securities laws and should preserve investor access to meaningful guidance, affordable advice and choice in both investment solutions and payment options, which will take time.
  3. The use of FINRA Rule 2111 and various interpretive guidance as a standard.
  4. While the U.S. Department of Labor has a fiduciary standard for retirement accounts, many people continue to have serious concerns with this approach. The bill uses the DOL fiduciary rule as a basis; however, the letter suggests that Nevada either waits to see the outcome of that rule or build in language which would automatically update the rule to be consistent with any future federal changes.
  5. The letter suggests that any regulations acknowledge the possibility of a future SEC and/or FINRA fiduciary/best interest standard.
  6. The new law permits Nevada to exclude acts or practices from within the act’s purview. The co-signers have offered to provide Nevada with a detailed list of activities that they believe should be excluded from the definition of financial planning. 

The co-signers of the letter include:
ADISA
American Council of Life Insurers
Bond Dealers of America
Center for Capital Markets Competitiveness
Equity Dealers of America
Financial Services Institute
Insured Retirement Institute
Money Management Institute
SIFMA
 
Read the letter in its entirety here.