IMOs to DOL: Fiduciary rule class exemption sets too high a bar
January 24, 2017 by Warren S. Hersch
Critics are voicing alarm over a Department of Labor proposal permitting independent marketing organizations to act as financial institutions under the DOL’s best interest conflict rule. Chief among their concerns: that the proposal establishes too high a sales threshold for most IMOs, one that could force widespread consolidation of a distribution channel already facing an uncertain future under the rule.
That’s the assessment of industry stakeholders contacted by LifeHealthPro following the department’s January 19 release of its “Proposed Best Interest Contract Exemption for Insurance Intermediaries.” Published in the Federal Register, the 220-page proposal (29 CFR 2550) would extend to qualifying IMOs a class exemption under the fiduciary rule from certain prohibited transactions of the Employee Retirement Security Act of 1974.
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