AARP Calls for Changes to SEC's Investment Advice Proposal

The Association for the Advancement of Retired Persons (AARP) is urging the Security and Exchange Commission (SEC) to offer tougher proposed investment advice to investors, reports Politico Pro . The agency expressed concern that the rules would be confusing to savers and risk exposing them to conflicted advice. "The current SEC proposal does not clearly define a 'best interest standard,' and we believe it must do so," says AARP's David Certner. "Investors also do not understand the different legal standards, or the disclosure forms that apply to different types of financial professionals." Two months ago, the SEC voted to propose rules requiring brokers to act in their customers' best interest when making investment recommendations. They proposed requiring investment professionals to disclose their relationship with customers in a four-page document, and to ban certain financial advisers from describing themselves as advisers. Investment advisers are held to a higher fiduciary standard of care than brokers, who must comply with a suitability standard when offering customers advice. AARP sees itself as the biggest nonprofit, nonpartisan organization committed to people over 50, and it supported the Obama administration's fiduciary rule for brokers, which was jettisoned by an appeals court in March.