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Greenwald Research Uncovers Significant Deficiencies in NASAA Survey Design and Execution


Over the past few months, the IPA has been leading a dedicated group of our members and a coalition of industry groups to engage Greenwald Research and Dr. Matthew Greenwald, a recognized expert in survey research, in an analysis of the North American Securities Administrators Association’s (NASAA) Regulation Best Interest (Reg BI) Implementation Committee’s surveys and reports. The stated purpose of the surveys was to measure the efficacy of Reg BI in elevating broker-dealer conduct and to inform additional state rulemaking and examinations. NASAA has already indicated it is working on a model broker-dealer standard of conduct.

Dr. Greenwald, who has 36 years of experience in conducting survey research involving investors, financial professionals and executives in financial services companies, led a careful review of the Committee’s research effort and uncovered significant deficiencies, including the failure to follow eight well-established and critical survey research practices. The analysis also found that the surveys failed to collect information on key actions firms have taken pertinent to Reg BI and the best interests of their clients.

Dr. Greenwald’s work highlights the lack of objectivity and points to an unstated agenda in the surveys, including a focus on certain investment product types—private securities, variable annuities, non-traded REITs and leveraged or inverse ETFs—apparently disfavored and deemed by the survey authors to be “complex, costly and risky” (CCR).

Further, the resulting 14-page analysis provides an in-depth look at the flaws in the surveys’ design and execution that undermines NASAA’s findings and conclusions. It determines that the surveys cannot be relied upon as accurate measures of firm behavior, compliance with Reg BI, the impact of the regulation or the extent to which the interests of investors are well-served. It also questions the unjustified focus on the four CCR product types as an inaccurate characterization and irrelevant to a proper Reg BI analysis. In conclusion, Dr. Greenwald’s report states that any attempt to realistically assess the impact of Reg BI, and achieve NASAA’s stated research purpose, would require a completely new survey or other type of analysis.

The IPA and our coalition partners as those raised in the Greenwald Research report—particularly around methodology and the validity of the resulting findings—when NASAA released its first survey to broker-dealer and investment adviser firms. Unfortunately, those and not addressed in the second survey or the resulting reports.

In sharing this report with state regulators and NASAA, we hope to provide a source of constructive information. Based on Dr. Greenwald’s findings, we’ve urged states not to move forward with additional rulemaking or regulatory guidance in relation to Reg BI. We believe that the SEC is best positioned to regulate and enforce the rule.

The executive summary and full analysis are available to our members here:

In the coming months, this report will be a cornerstone of our federal and state advocacy efforts, as we use the findings in a concerted outreach strategy to engage with influential regulators, policymakers and others.

Finally, I would like to extend a special thank you to our industry partners including SIFMA, FSI, IRI, ACLI, ADISA, Nareit, SBIA and others, as well as Mark Quinn, co-chair of our Policy, Regulatory and Legal Affairs Committee, for their support and time spent on this important effort. I also want to extend a thank you to IPA members that participated in the in-depth cognitive interviews conducted by Dr. Greenwald as part of his analysis.

If you have any questions, please don’t hesitate to reach out to Tony or me.


Anya Coverman
SVP, Government Affairs and General Counsel
Institute for Portfolio Alternatives