Massachusetts

Fiduciary/Best Interest Development

Advisor Fee Table

  • The Massachusetts Securities Division (“Division”) has adopted a rule requiring investment advisers registered with the Division to create a stand-alone Table of Fees for Services. The Division has provided instructions for creation of the form and a template for development of the Table.
  • Specifically, an investment adviser must create a one-page fee table, which includes all fees and services provided by the adviser. The Division notes that the “Fee Table supplements, but does not replace” an adviser’s disclosure obligations.
  • The fee table must be updated annually in coordination with the timing of required amendments to the adviser’s Form ADV, and must be delivered annually in paper or electronic form to the investment adviser’s current advisory clients.
  • The requirement will be enforced by the Division beginning January 1, 2020.
Sources

Adoption of Amendments to Investment Adviser Disclosure Regulations

Broker-Dealer Fiduciary Standard

  • The Division issued a request on June 14, 2019 for comments on a proposed regulation to apply a fiduciary conduct standard on broker-dealers, investment advisers, and investment adviser representatives.
  • The standard is based on the duties of care and loyalty and will apply to “the provision of recommendations, advice, and to the selection of account types.”
  • The preliminary comment period is set to end on July 26, 2019. No effective date has been announced.
  • It is unclear whether the final proposal will include a private right of action.
Sources

Massachusetts Proposed Fiduciary Standard For Broker-Dealers and Investment Advisers