SEC Chairman Jay Clayton: New regulations will force brokers to be 'very candid' with investors
Chairman Jay Clayton told CNBC on Thursday the agency's new rules on conflict of interest will force brokers to have "very candid" conversations with investors.in a 3-1 vote Wednesday. Stockbrokers will be required to disclose any potential conflicts of interests when they give investment advice. It also bans sales contests among broker-dealers and quotas that reward brokers who generate the highest sales of certain products." interview.
Clayton said the old standard was not substandard but also wasn't "clear enough." When asked whether this new rule would stifle innovation in the brokerage space by adding unexpected regulatory expenses, Clayton said, "No."