Roughly 24 hours before the Securities and Exchange Commission (SEC) is set to vote on the so-called “Reg BI” proposal from SEC Chairman Jay Clayton, the Public Investors Arbitration Bar Association (PIABA) and Consumer Federation of America (CFA) issued an unusually strongly worded warning that the proposal will do more harm than good and is being misrepresented by the SEC. PIABA and CFA were joined by Better Markets during a phone-based news conference today.
The PIABA-CFA statement reads in part: “… the final (Reg BI) package will fall far short of what investors need and deserve. There is a reason why Wall Street is clamoring for the Clayton plan and why it has encountered nearly universal opposition from investor advocates. While the Chairman’s plan is being pitched to the news media and Capitol Hill as improving protections for retail investors, the truth is that it is actually a step backwards: It will leave investors with fewer protections in important areas than they would have had if the Commission had not acted. If truthfully labeled in terms of its impact on investors, it would be called Regulation NBI (Not Best Interests).”