Not content with the Department of Labor’s fiduciary rule that went into effect June 9, the state of Nevada will hold all investment advisors and broker-dealers to the fiduciary standard starting in July, Lexology writes.
Nevada’s fiduciary rule, going into effect July 1, will extend the fiduciary standard to all financial planners, according to the legal news and analysis website. The Nevada Senate bill, signed off on June 2 by Nevada Gov. Brian Sandoval, also modifies the previous definition of “financial planner” by removing the exemption on broker-dealers, investment advisors and their representatives, according to Lexology. The definition will not apply to attorneys, CPAs and insurance producers, the website writes.
To comply with the rule, financial planners must disclose any profit or commissions they receive from the advice offered at the time that it’s given, the website writes. In addition, financial planners must also regularly assess their clients’ financial condition and goals, according to Lexology. The new rule also lets the Nevada state securities regulator further refine the fiduciary duty in regard to exclusions and definitions of violations, the website writes. But that rule-making would only encompass broker-dealers, their representatives, investment advisors, and their representatives, according to Lexology.
The DOL’s fiduciary rule, which went into partial effect June 9 following a 60-day delay, requires only advisors on retirement accounts to act in their clients’ best interest. The agency has made it clear that it will continue reviewing the rule as directed by President Donald Trump in February. Furthermore, the DOL is relaxing many requirements of its rule and is giving the industry leeway in compliance ahead of the full implementation date currently scheduled for January. The rule continues facing stiff opposition as well as the threat of an outright repeal as part of a Dodd-Frank overhaul bill approved by the House of Representatives, although the bill is not likely to pass the U.S. Senate.