Financial Advisers Get DOL Guidance on Fiduciary Rule Delay

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By Jo-el J. Meyer

Financial advisers got some direction from the Labor Department on what to expect if the agency is unable to sort out the delay of its fiduciary rule ahead of its April 10 implementation date.

The Department of Labor March 10 issued a field assistance bulletin that sets out a temporary enforcement policy for the rule. The agency has proposed delaying the rule’s April 10 applicability date by 60 days, to June 9. Its decision to seek the delay was made in order to comply with President Donald Trump’s presidential directive to review and possibly revise or rescind the rule.

The Obama-era rule requires financial advisers to retirement investors to act in their clients’ best interest.

The DOL said it intends to issue a decision on whether to officially delay the rule prior to its April 10 applicability date. But financial services institutions have expressed concern about what would happen if there isn’t a final rule implementing the delay before that date. The industry is also concerned that if the DOL decides not to issue a delay based on its evaluation of public comments, financial services firms and advisers will have little time to comply with the rule.

To address these possibilities, the agency said that in the event the department issues a final rule delaying the applicability date sometime after April 10, the department won’t initiate enforcement actions against advisers during any “gap” period that might be created.

In the event the department decides not to delay the rule, it won’t initiate an enforcement action because an adviser or financial institution failed to comply with the rule by the April 10 applicability date, the agency said.

To contact the reporter on this story: Jo-el J. Meyer in Washington at jmeyer@bna.com

To contact the editor responsible for this story: Karen Ertel at kertel@bna.com

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