DOL Asks You if it Should Delay Fiduciary Rule Again
June 30, 2017 | By Alex Padalka | Financial Advisor IQ
The Department of Labor has issued a request for information on the fiduciary rule, comments from which could lead to an eventual delay of its scheduled implementation date.
The first set of questions in the RFI, for which the comment period ends in 15 days, addresses a possible extension of the applicability of certain provisions in the rule, whose full implementation is currently scheduled for January 1. These include the rule’s best interest contract exemption, which lets retirement brokers sell some commission-based products after signing an agreement with their clients, as well as class exemptions for certain principal transactions and prohibited transactions, according to the RFI.
The DOL notes that input from its previous comment period suggests “recent innovations” could form the basis of new compliance mechanisms — in particular the use of so-called “clean shares,” which standardize fees across share classes to reduce conflicts of interest in the sale of mutual funds. But commenters have also said that the industry may not be able to develop clean shares by the January 1 deadline, according to the DOL.
In its recent RFI, the regulator seeks input on the pros and cons as well as the risks and costs of any delay.
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The Blue Vault Summit could not have been more perfectly timed. This gathering of the Broker Dealer and Sponsor communities provided insightful and open discussion from several vantage points. These conversations are paramount, especially in a time of significant regulatory change.