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DOL Fiduciary News: June 29, 2016

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Principal Exec on DOL Fiduciary Rule: ‘We Think We Can Be a Net Winner on This’

Best's News Service via Bestwire – June 28, 2016 01:52 PM

DES MOINES, Iowa – Principal Financial Group Inc. is “deep in implementation” of the U.S. Department of Labor’s fiduciary rule update, which has been challenged by lawsuits, an executive from the company said.

Although the rule is complicated regulation that crosses over a number of Principal’s businesses, including its mutual fund and rollover IRA businesses, “we are very, very focused on it,” Deanna Strable, president, U.S. insurance solutions, said during a fireside chat at the Des Moines Insurance Conference on June 28.

DOL fiduciary rule will nudge 401(k) advisers to zero-revenue-share fund lineups

InvestmentNews; June 28, 2016 @ 1:45 pm

Retirement plan advisers are likely to use 401(k) investment funds that unbundle revenue-sharing payments from their cost because of the new Department of Labor fiduciary rule.

The DOL rule exposes advisers receiving variable compensation, such as 12b-1 fees and commissions, to greater compliance requirements and litigation risk. Experts believe advisers will try to mitigate that risk by using funds that strip out such compensation.

Advicent product suite empowers firms and advisors to comply with impending DOL fiduciary rule while keeping financial planning at the core

June 28, 2016 02:06 PM EDT

MILWAUKEE -- (BUSINESS WIRE) -- The Department of Labor (DOL) has set a new standard for advisors by redefining who qualifies as a fiduciary. New objectives aim to ensure that advisors are always putting the best interests of their clients first, and reduces conflicts of interest for advisors by increasing fee disclosures. Many believe that this fiduciary standard will increase the cost of business for advisors due to the cost to comply, and if some advisors want to continue to plan for a client’s retirement with investments, they will need to adjust their workflow.

It is clear that holistic financial planning will play a key role when creating compliance strategies for the impending DOL fiduciary rule for many financial services professionals. Advisors will need to deliver proof that they are providing credible advice that is in the best interest of their clients. Planning software and other FinTech tools will make this easier to accomplish and keep these records if they are needed in the future.

A CEO’s Lament for 50% Share Plunge: Oil, Brexit and Regulation [American Equity Investment Life]

Bloomberg; June 28, 2016 — 3:42 PM EDT

American Equity Investment Life Holding Co., which has seen the value of its stock plunge by half over the past year, said the energy market slump, new regulation from the U.S. Department of Labor and the U.K. decision to leave the European Union have all contributed to the rout.

“Wow, what a difference a year makes,” Chief Executive Officer John Matovina said Tuesday at a conference in Des Moines, Iowa. “That just goes to show you what an energy credit scare, a DOL scare, and now a Brexit will do to a company that’s heavily influenced by what happens in the interest-rate environment.”

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