Larry emphasizes that the SEC opted not to define “best interest,” but instead sprinkled guidance on the contours of “best interest” throughout Reg. BI. The concept of best interest will be principles-based, and not a bright-line test. There is not a per se prohibition against conflicts of interest. Crucially, however, the broker’s interests can’t be placed ahead of the retail investor’s interests.
George Michael Gerstein advises financial institutions on the fiduciary and prohibited transaction provisions of ERISA. As co-chair of the fiduciary governance group, he assists clients with tracking, and understanding, the numerous fiduciary developments at the federal and state levels, including the rules and regulations of governmental plans. He also advises clients with respect to the fiduciary duty implications of ESG investing.