Summary

The Securities and Exchange Commission (“SEC”) is proposing new rules (“proposed conflicts rules”) under the Securities Exchange Act of 1934 and the Investment Advisers Act of 1940 to eliminate, or neutralize the effect of, certain conflicts of interest associated with broker-dealers’ or investment advisers’ interactions with investors through these firms’ use of technologies that optimize for, predict, guide, forecast, or direct investment-related behaviors or outcomes. The SEC is also proposing amendments to rules under the Exchange Act and Advisers Act that would require firms to make and maintain certain records in accordance with the proposed conflicts rules.