Statement of Bartlett Naylor, Financial Policy Advocate, Public Citizen’s Congress Watch Division
Note: Today, the U.S. Securities and Exchange Commission (SEC) finalized a quartet of rules, described as “Regulation Best Interest,” governing how stock brokers recommend investments to their customers, given that some investments pay better commissions to the broker than others. But the rules will allow brokers to boost their own commissions at the expense of clients without disclosing it. The SEC voted 3-1 to approve the rules, with Democratic Commissioner Robert Jackson in the minority.
Investors beware! These rules have less value than a degree from Trump University. Brokers now can siphon billions from unwary savers with the government’s permission. Public Citizen will continue to review this voluminous set of rules, but it’s clear that key investor protections are missing. For example, the SEC should have barred broker conflicts altogether.
The SEC is supposed to be a watchdog for investors, but President Donald Trump’s appointees are letting Wall Street take a bite out of investors’ wallets instead. Personnel is policy, so it was inevitable that a rule approved by a Goldman Sachs attorney, a Koch-funded libertarian and a stock exchange counsel would ignore the needs of average investors. Commissioner Jackson deserves applause for attempting to improve this rule and rebuking what the SEC finalized. He understands his oath to put investors first.