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Governance of Financial Institutions edited by Busch, Danny; Ferrarini, Guido; van Solinge, Gerard (31st January 2019)

Part IV Conduct and Culture, 20 Conflicts of Interest: Comparing Compliance and Culture in the United States and the United Kingdom

Geneviève Helleringer, Christina Skinner

From: Governance of Financial Institutions

Edited By: Danny Busch, Guido Ferrarini, Gerard van Solinge

From: Oxford Legal Research Library (http://olrl.ouplaw.com). (c) Oxford University Press, 2015. All Rights Reserved.date: 17 October 2019

Subject(s):
Regulation of banks — Investment business

This chapter focuses on conflicts of interest in the retail space. Because of the structure of incentives, conflicts of interest situations regularly arise in the context of retail investment advice. As such, conflicts of interest have been the focal point of regulators' efforts to improve conduct in the retail investment space. In the United States, both the Securities and Exchange Commission (SEC) and the Department of Labor (DOL) have embarked on rulemaking projects to heighten and refine the fiduciary duties that investment advisors owe to retail clients — and, in particular, the duty of loyalty that dictates the identification and management of conflicts of interest. Similarly, as a result of the Financial Conduct Authority’s ‘Retail Distribution Review’, U.K. regulators have issued new guidance on how the investment adviser can best comply with his or her fiduciary duties.

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