State securities regulators have given themselves a one-year deadline to produce a plan to increase broker-fee disclosures, a process they hope will be strengthened by industry participation.
Last week, the North American Securities Administrators Association announced the
formation of a working group to come up with recommendations to make disclosures easy-to-read and more useful for investors.
“It is our goal that by the next fall conference, we will have a work product,” Bryan Lantagne, director of the Massachusetts Securities Division, said during a panel on Sunday at the NASAA annual conference in Indianapolis. “We have no intention of this to be a working group in perpetuity.”
Mr. Lantagne said one of the strengths of the panel is the participation of industry groups, such as the Financial Services Institute, which represents independent broker-dealers and financial advisers, and the Securities Industry and Financial Markets Association, the major Wall Street trade association. Both FSI and SIFMA contributed to the working group's mission statement.
“Now, of course, we want to see is if, in fact, that will translate to … a willingness to get a rule, model, set of recommendations in place,” Mr. Lantagne said.
If so, Mr. Lantagne sees a good chance for a successful outcome.
“When you have all the players at the table, it's easier to move the ball,” he said.
Dale Brown, FSI president and chief executive, was in attendance at the NASAA conference.
“We're going into it committed to pursuing transparency for investors,” Mr. Brown said in an interview.
The NASAA working group is not going to draw conclusions about whether brokerage fees are too high, Mr. Lantagne said. It's trying to make them transparent.
“It's a crucial area,” he said. “The investor should be able to go in and do comparison shopping. We want the consumer to have the ability to make his or her own decision [about the fee level].”
