Public Comment Deadline Closes on DOL Review of Fiduciary Rule
April 17, 2017 by Frank Klimko
WASHINGTON – The window for public comment has closed on the U.S. Labor Department’s new economic and legal analysis on whether the fiduciary rule will hurt investors or make it harder for the retirement services industry to provide advice.
The April 17 deadline was the second of two comment periods ordered by the DOL as it attempts to reconsider and possibly recast the fiduciary rule. The first deadline of March 17 ended the comment period on the 60-day delay for implementation, which has been pushed back to June 9.
The new fiduciary mandates change how retirement advisers conduct business. Except for special circumstances, the requirements generally move such transactions away from commission-based compensation.
During the second comment period, the DOL was accepting public input on the broader review. As part of the examination, the department was directed to reconsider whether the fiduciary rule and the changes to the prohibited transaction exemptions reduce investor access to advice, disrupt the retirement adviser market or increase the likelihood of litigation or prices that investors and retirees must pay.
The DOL issued the delay in response to memorandum from President Donald Trump to review and possibly rescind the rule initiated by the DOL under President Barack Obama (Best’s News Service, March 1, 2017).
Market observers remain concerned efforts by the Trump administration don’t amount to adequate relief.
The DOL notices so far maintain the new definition of a fiduciary — which appear to extend the federal Employee Retirement Income Security Act regulation to IRAs and sweep in virtually anyone who has discussions on investments or rollovers, Charles Gabriel, president of Capital Alpha, said in a research note.
“It’s the wider interpretation that will force a multiplied number of advisers or insurance agents to become fiduciaries,” Gabriel said.
(By Frank Klimko, Washington correspondent, BestWeek: Frank.Klimko@ambest.com)
