AARP, NASAA and CFA Join Forces in Support of Proposed Senate Bill

A coalition including AARP, NASAA and Consumer Federation of America has written a joint letter to Senators Dodd and Shelby (Chair and Ranking Member, respectively, of the Senate Banking Committee) urging their support for the elimination of the broker-dealer exclusion in the definition of investment adviser in the Investment Advisers Act.  If adopted, broker dealers offering investment advice would be subject to the fiduciary duties applicable to other investment advisers.  They charge that the proposed legislation has been the subject of intense lobbying efforts by the broker-dealer and insurance industries and single out the latter's attacks as "particularly virulent."  They note that regulators have identified unsuitable sales of expensive variable annuities by insurance salesmen as a longstanding and serious problem.