MSRB issues draft of new 529 dealer requirements
The Municipal Securities Rulemaking Board (MSRB) has issued Notice 2005-28 "Request for Comments on Draft Interpretation on Customer Protection Obligations Relating to the Marketing of 529 College Savings Plans" which would require that dealers of 529 plans take certain actions in making suitability determinations when recommending 529 plans to customers. The notice covers the basic customer protection obligation, point-of-sale disclosures and the use of established industry sources, special disclosure considerations in connection with the availability of state-based benefits, use of the program disclosure document, general suitability requirements, additional suitability requirements in connection with out-of-state 529 sales, and other sales-related activities. The MSRB also seeks comments on the possibility of creating a website to provide a centralized source of information about all 529 plans.
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