SIFMA Submits Comments to MSRB on Duties of Non-Solicitor Municipal Advisors

SIFMA submitted comments to the MSRB on a draft proposal for MSRB Rule G-42 regarding the standards of conduct and duties of municipal advisors when engaging in municipal advisory activities other than the undertaking of solicitations.

According to the letter, SIFMA supports the MSRB's efforts to develop a framework for the regulation of municipal advisors; however, SIFMA stated that it is concerned about certain aspects of the proposed rule, including that:

• the rule would improperly impose a fiduciary duty on municipal advisors providing advice to obligated persons;
• the proposed blanket prohibition on principal transactions between a municipal advisor with either a municipal entity or obligated person clients; and
• the documentation and disclosure requirements, among other concerns.

Additionally, SIFMA stated that the MSRB's draft economic analysis fails to meet the MSRB statutory mandate and its own stated policy, and should focus at a much more granular level on the benefits and burdens of each specific proposed requirement.

See:SIFMA Comment Letter.