What Is The Fiduciary Rule? Department Of Labor Delays Implementation 60 Days

What Is The Fiduciary Rule? Department Of Labor Delays Implementation 60 Days

What Is The Fiduciary Rule? Department Of Labor Delays Implementation 60 Days

President Donald Trump signed a memorandum that asks the Labor Department to review the fiduciary rule and determine whether it should be revised or rescinded.

The controversial rule would expand the definition of fiduciary.

Some consumer advocates took umbrage at the proposal.

The Labor Department is proposing to extend the applicability date of the fiduciary regulation by a mere 60 days - while taking (just) the next 15 days to collect comments on that proposal.

"More delays are likely", said Mr. Saxena, given that the Labor Department doesn't yet have a secretary installed. "Frankly, delaying implementation of this rule would be a slap in the face to the companies that have invested, in good faith, for a deadline that has stood for the past year-and to the everyday worker deserving of the assurance that their retirement adviser is working in their best interest". The Labor Department acknowledges that "the economic effects may be partially dependent on what action the Department ultimately takes, and in the shorter term, what the public anticipates the Department may do".

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After the rule was finalized past year, it faced multiple court challenges from business groups seeking, unsuccessfully, to block the regulation.

A 60-day delay is somewhat surprising, as most had expected a six-month delay.

Consumer groups who support the rule are anxious a delay could open the door for opponents to find ways to weaken or eliminate the rule.

Kenneth Bentsen, SIFMA president and CEO, said, "The delay will allow the new administration an opportunity to review the rule's impact on investors and the market, while providing firms additional time to prepare for potential changes to the rule".

President Trump's order on February 3 that the agency review the fiduciary rule has confused brokerage firms, some of whom fear legal liability from violating the rule's tight exemptive relief if they offer commission retirement accounts that are product-oriented.

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