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DOL Fiduciary News: April 25, 2016

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DOL fiduciary rule could spark acquisitions of RIAs as well as broker-dealers 

InvestmentNews; Apr 24, 2016 @ 12:01 am

The DOL fiduciary rule, already expected to spur consolidation in the broker-deal industry, could also hasten mergers in the registered investment adviser space.

“Our merger conversations are up 20% over last year” and the Labor Department's fiduciary rule is a big part of those discussions, said Paul Lally, president of Gladstone Associates, a consulting firm that specializes in mergers and acquisitions for RIAs.

Still plenty of headaches for independent broker-dealers in the DOL fiduciary rule 

InvestmentNews; Apr 24, 2016 @ 12:01 am

Even though the Labor Department's recent changes to how financial advisers can counsel clients on retirement assets isn't the industry killer some had feared, independent broker-dealers will find plenty of unpleasant realities among the details of the final 1,023-page rule.

The Labor Department's conflict-of-interest — or fiduciary — rule, which will begin to take effect in a year, will require all professionals to recommend what is in the best interests of clients when they offer advice on 401(k) plan assets, individual retirement accounts or other qualified monies saved for retirement.

Charles Schwab CEO does not expect big market share changes from DOL rule; Friday, April 22, 2016 2:14 PM ET

Charles Schwab Corp. President and CEO Walter Bettinger does not see the federal government's new fiduciary standard rule for retirement advice causing major market share shifts.

Clients who trust brokers or advisers they have been working with for years will not leave them because the terms of their interactions have changed, Bettinger said during a quarterly business update.

NAFA Board Authorizes Action On DOL Fiduciary Rule 

WASHINGTON (Apr. 21, 2016) — NAFA, the National Association for Fixed Annuities, announced today that its Board of Directors authorized staff to consider all options for challenging the Department of Labor’s recently issued fiduciary rule, including efforts seeking legislative relief as well as possible litigation. In preparation for the rule’s release, the association formed a working group spearheaded by its legal team to conduct a thorough review and analysis of DOL’s new regulatory requirements. Now that the initial review is complete, NAFA is preparing to take action to ensure its members, American savers and small businesses across the country are protected from this unnecessary and unworkable overreach.

A Mutual-Fund Fee Falls Out of Favor 

The Wall Street Journal; April 22, 2016 5:30 a.m. ET

A controversial type of mutual-fund fee—in which dollars are subtracted from fund assets to compensate brokers and other distributors—is losing favor.

The latest factor weighing on so-called 12b-1 charges is the Labor Department’s new fiduciary-duty rule for advisers who work with retirement accounts. The rule requires these brokers to put their clients’ interests first and to disclose their compensation and conflicts of interest.

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