In The Hill, James Allen of CFA Institute lays out a thoughtful case for reexamining Dodd-Frank — not to dismantle it, but to make it smarter, more targeted, and more effective. As Allen explains, seven years after its passage, many provisions of Dodd-Frank have yet to be fully implemented, and many others have proven burdensome without delivering on the law’s core promise: preventing another financial crisis.
“Legislation needs to fix real problems in the law, but must leave in place those provisions that have enhanced the long-term health of our capital markets.”
With a new administration and Congress in place, reform is back on the table. The Financial CHOICE Act, spearheaded by Rep. Jeb Hensarling (R-TX), aims to update the regulatory architecture by focusing on stronger capital requirements, smarter oversight, and clearer accountability. CFA Institute welcomes many of these steps — particularly efforts to strengthen the role of the SEC and bring clarity to the murky world of financial titles and fiduciary responsibilities.
For years, brokers have been allowed to call themselves “financial advisors” — blurring the line between those who owe their clients a fiduciary duty and those who don’t. Allen rightly argues it’s time to fix that:
“The SEC needs to limit the use of the title ‘adviser,’ or any derivative of that title, to those who are subject to the fiduciary duties stemming from the Investment Advisers Act. Those subject to the lower suitability standard should have to call themselves ‘salespersons.’”
This isn’t about deregulation for its own sake. It’s about better regulation — regulation that actually protects investors, boosts transparency, and reduces systemic risk without crushing smaller institutions or stifling innovation.
Reformers would also be wise to keep what works. Strong capital buffers for banks and oversight of systemically important institutions are not partisan issues — they’re essential for financial stability. As Allen notes, “the devil is in the details,” and changes must be made carefully to avoid unintended consequences.
As the conversation around Dodd-Frank continues, CFA Institute’s voice remains consistent: investor trust and market transparency must come first.