Los Angeles partner Fred Reish was quoted in the ThinkAdvisor article “Scottrade Charged Under DOL Fiduciary Rule in Massachusetts.” The article discusses the Massachusetts Securities Division’s administrative complaint against Scottrade, which states that Scottrade “held at least two sales contests which included retirement assets,” which violates the impartial conduct standards laid out in the DOL fiduciary rule.

The complaint states that Scottrade adopted a rule to adhere to the impartial conduct standards that prohibited sales quotas, appraisals, bonuses, contests and other incentives for retirement or prospective retirement account clients, but it failed to enforce this rule. Concerning their actions, Fred said that while the Employee Retirement Income Security Act “has its own remedies, for example, claims for fiduciary breaches, it was not [made] clear how violations of the Impartial Conduct Standards involving IRAs would be enforced.” He also advised broker-dealers to “review their policies, procedures and practices, including supervision, around any compensation arrangements that could incent advisors to make recommendations that favor the advisors over the interests of investors.” 

Read "Scottrade Charged Under DOL Fiduciary Rule in Massachusetts.”

Source: ThinkAdvisor
Leave Drinker Biddle to Learn More