A New Jersey senator introduced a bill in the state Senate requiring non-fiduciary investment advisers to specifically tell clients they "are not required to act in the client's best interests."
Sen. Patrick J. Diegnan Jr. introduced the bill Tuesday. It's the same bill that Mr. Diegnan introduced in 2016 as a senator and in 2015 as a member of the General Assembly. Neither bill was considered by the respective Senate and assembly committees.
"The bill requires non-fiduciary investment advisers to make a plain language disclosure to clients orally and in writing at the outset of the relationship that ensures that individual investors are aware of the potential conflicts of interest," said a statement accompanying the bill.
According to the bill, "the required disclosure must state the following: 'I am not a fiduciary. Therefore, I am not required to act in your best interests.'"
The bill requires confirmation by clients that they understand the nature of the non-fiduciary relationship, the bill said.