WASHINGTON — Dealer groups and market participants criticized the Municipal Securities Rulemaking Board’s draft rule on broker’s brokers last week, saying it would undermine, not improve, secondary market liquidity.

The remarks, in comment letters filed with the MSRB on draft Rule G-43 on the fair pricing obligations of broker’s brokers, come as regulators have stepped up scrutiny of the secondary market. Officials say they are concerned retail investors may not receive fair and reasonable prices when broker-dealers sell municipal securities through broker’s brokers, which are dealers that principally effect transactions for other dealers.

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