Brokers vow to pull business if Nevada sets fiduciary duty
March 26, 2019 by Kenneth Corbin
Several of the nation’s leading broker-dealers are threatening to stop doing business in Nevada if the state moves to impose a fiduciary duty on the industry.
Those firms, including Morgan Stanley, Charles Schwab, TD Ameritrade and Wells Fargo, have all submitted letters to the state warning that if the fiduciary rule took effect, it would effectively eliminate access to low-cost, transactional brokerage services for Nevada residents.
They argue that the liabilities and compliance costs associated with an ongoing fiduciary duty would make it impractical to offer the basic brokerage services favored by low- and middle-income investors.
TD Ameritrade, for instance, writes: “If the proposal is enacted as drafted, the practical effect on TD Ameritrade’s self-directed brokerage operations could be to either (a) discontinue offering products and services to residents of the state of Nevada or (b) discontinue providing much of the educational content, tools and other customer support that self-directed clients rely upon …”
Click HERE to read the full story via Financial Planning.