The Maryland Senate Finance Committee defeated S.B. 786, a bill that would impose a state-specific fiduciary standard on investment advice.
FSI President and CEO Dale Brown responded to this development:
“While we support the Maryland General Assembly’s goal of investor protection, a state solution will only lead to more confusion and hurdles, ultimately hindering Marylanders’ access to affordable, professional financial advice. FSI has long supported a federal uniform standard of care for all investment advice, and we believe the SEC is the appropriate authority to develop such a standard. State-specific standards will lead to a patchwork of varying requirements across the country, confusing investors and creating uncertainty for advisors who are trying to best serve their clients while also obeying state and federal regulations. Varying standards would also drive up compliance costs for financial advisors, ultimately limiting services or increasing costs for Main Street investors. Like Maryland, we strongly encourage all states to wait for the SEC to finalize Regulation Best Interest.”
Last month, Brown, testified before the Maryland Senate Finance Committee and House Economic Matters Committee about the state’s proposed fiduciary rule regarding investment advice and its impact on Main Street investors. Brown stressed that the proposal will drive up compliance costs for advisors while limiting services and increasing costs for investors. He urged Maryland to wait until the SEC’s Regulation BI is finalized as the SEC is the appropriate agency to address this issue.
FSI also hosted a Maryland State Capitol Day for members to meet with Maryland legislators and discuss the negative effects a state fiduciary duty would have on their businesses and clients. FSI also co-chaired the Maryland Consumers Best Interest Coalition which lead and organized the industry’s opposition to the bill.
The companion bill in the Maryland House Economic Matters Committee, H.B. 1127, has not seen any movement and is expected to die when the Maryland General Assembly adjourns on Monday, April 8.
