Senate must protect investors



Published:

To the editor:As the securities regulator closest to Main Street investors in New Hampshire, I have encouraged our delegation in the U.S. Senate to help protect these investors by improving the Restoring American Financial Stability Act of 2010.After a well-funded, and in some instances, misleading lobbying campaign by industry, the single most important investor protection provision in the act was removed by Senate Banking Committee and replaced with an unnecessary study. As originally drafted, the Senate Banking Committee’s proposal would have required stockbrokers who provide investment advice to abide by a fiduciary duty or, in other words, to act in the best interests of their customers. This approach was entirely consistent with the goal of aligning the legal responsibilities of stockbrokers with the trusted relationship investors expect.Now, however, instead of providing investors with the protection they expect and deserve they are handed a delay in the form of a year-long study.I support the amendment sponsored by Senators Bob Menendez and Dan Akaka to replace this study with a provision approved in the House regulatory reform legislation to direct the Securities and Exchange Commission to conduct rulemaking to establish a fiduciary duty requirement for broker-dealers providing investment advice in certain circumstances.This provision represents an important first step in closing a significant regulatory gap and providing much-needed protection to investors in New Hampshire and throughout the United States. Mark Connolly Director N.H. Bureau of Securities Regulation

 

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