Nevada

Fiduciary/Best Interest Development

  • New state law effective July 1, 2017, amends NRS 628A.010 and NRS 90.575
  • Provides that a financial planner “has the duty of a fiduciary toward a client”
  • “Financial planner” means a person who for compensation advises others upon the investment of money or upon provision for income to be needed in the future, or who holds himself or herself out as qualified to perform either of these functions
  • The law imposes a fiduciary duty on broker-dealers, sales representatives and investment advisers who for compensation advise other persons concerning the investment of money
  • The law does not include a definition of a fiduciary duty but does provide for a private right of action
  • Implementation of the law is dependent on the adoption of regulations.
  • The law does not apply to sales of insurance, unless accompanied by investment advice
  • On January 18, 2019, Nevada released draft regulations
  • In general, the draft regulations describe the substantive duties investment advisors and broker-dealers owe their clients, what actions constitute a breach of their fiduciary duties, as well as certain exceptions to these regulations
  • The comment period ended on March 1, 2019.

Sources

Senate Bill No. 383
September 8, 2017 Notice of Regulation
October 2, 2017 Notice of Regulation
January 18, 2019 Draft Fiduciary Duty Regulations