Richard Ketchum, chairman and chief executive officer of the Financial Industry Regulatory Authority, delivered a speech at the National Association for Variable Annuities Government and Regulatory Affairs Conference on June 8 in which he stated that if FINRA had the authority to regulate investment advisors, investor protection would be improved. Ketchum said FINRA is “uniquely positioned to build an oversight program for investment advisors quickly and efficiently.” Ketchum also noted the “disparity” between oversight regimes for investment advisors and broker-dealers, particularly between the fiduciary standard for investment advisors and the rule requirements for broker-dealers (including suitability). Accordingly, he stated that holding investment advisors and broker-dealers to two different fiduciary standards was “untenable,” and that FINRA, in its effort to reform the financial regulatory system, will consider the need to explore seriously whether a properly designed fiduciary standard can effectively be applied to broker-dealer selling activities. Ketchum also discussed regulatory and oversight issues with respect to the annuities industry.
Click here to read the speech.