DOL fiduciary rule’s ‘grandfathering’ exemption may be lost by changing firms
Regulatory experts believe there’s a strong likelihood advisers would lose the grandfathering exemption granted under the DOL rule simply by switching RIAs or broker-dealers
Advisers banking on “grandfathering” pre-existing investments in retirement accounts under the Labor Department’s fiduciary rule may not be able to rely on the provision indefinitely.
As it turns out, industry executives and regulatory experts believe advisers switching firms could lose the grandfathering privilege upon switching firms, leading to a potential stymying effect on adviser recruitment and moves.
“It would really be a gray area as to if grandfathering would be lost,” Marcia Wagner, principal at The Wagner Law Group, said. “But who would want to take that risk?”
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.