Regulation Best Interest

What this video covers

• Why Reg BI applies only to retail customers (natural persons for personal, family, or household purposes) and what rule governs institutional recommendations instead
• The four component obligations of Reg BI: Disclosure, Care, Conflict of Interest, and Compliance, and why partial satisfaction is never a safe harbor
• How the Care obligation builds on the three suitability components (reasonable-basis, customer-specific, and quantitative) but demands a higher best interest standard
• The three-level conflicts-of-interest hierarchy: disclose general conflicts, mitigate conflicts that create incentives to favor the firm, and eliminate sales contests and short-term product-specific compensation entirely
• The critical timing distinction that Reg BI applies at the time the recommendation is made, not as a continuous ongoing fiduciary duty
• How Reg BI, the FINRA suitability rule, and know your customer (KYC) differ in scope, trigger, and customer type