WASHINGTON — Provisions within a proposed rule from the National Association of Securities Dealers on responsibilities regarding deferred variable annuities may be unwarranted, CUSO Financial Services, L.P. recently said.
At issue is a NASD rule that would impose specific sales practice standards and supervisory requirements on NASD members for transactions in deferred variable annuities including governing recommendations, principal review and approval obligations.
CFS said the proposal may not be needed because NASD's current 2310 rule "provides satisfactory suitability standards for all other products except a few high-risk products." The credit union-owned broker-dealer questioned how suitability will be determined if "reasonable" efforts are made to obtain information about the customers' existing investment and life insurance holdings.
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