Reg BI Didn’t Need a ‘Best Interest’ Definition: SEC Chief Clayton

July 22, 2019 by Melanie Waddell

Securities and Exchange Commission Chairman Jay Clayton on Monday rebuked criticisms that the agency’s recently approved Regulation Best Interest for brokers should have defined the term “best interest.”

In comments to investors at a Monday roundtable in Boston, Clayton defended Reg BI and argued that the rule is not “deficient” because it fails to define “best interest.”

During the run-up to the rule’s passage, “differing views were expressed regarding whether the standard should be more principles-based or more prescriptive — and in particular, whether to provide a detailed, specific, situation-by-situation definition of ‘best interest’ in the rule text,” Clayton said.

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Originally Posted at ThinkAdvisor on July 09, 2019 by Melanie Waddell.