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DOL Fiduciary News: December 1, 2016

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NAFA asks D.C. Circuit to delay DOL rule deadline; November 30, 2016

In the latest legal gambit in what is becoming an uphill battle for opponents of the U.S. Department of Labor’s fiduciary rule, the National Association of Fixed Annuities is asking the U.S. Court of Appeals for the District of Columbia to delay implementation of the fiduciary rule by at least 10 months.

The first so-called applicability date for compliance with the rule is April 10, 2017, at which point NAFA members — insurance carriers, insurance agents and independent marketing organizations — will have to act as fiduciaries when selling fixed indexed annuities to IRAs.

DOL Rule Could Force Broker Moves

Financial Advisor; November 30, 2016

Many advisors who will be unable to sell commissioned investments in IRAs after the DOL rule goes into effect are being forced to shop for new homes.

Firms and recruiters are seeing an uptick in the number of inquiries by reps looking for firms that will accommodate commission business. Some firms appear to be waiting to see if the rule survives, but that’s a big risk, observers said, because advisors can’t be stuck come April, when the rule is set to go into effect, with no way to do business.

“A fair amount of smaller B-Ds are not open to the BICE contract,” said recruiter Jon Henschen. “These small and midsized B-Ds have a lot of transactional business, and for [commissioned-based] reps, it’s a really big deal.”

A Trump Repeal of the DOL Fiduciary Rule? Not So Fast

ThinkAdvisor; November 30, 2016

Donald Trump campaigned on a platform to “reform the entire regulatory code” and “end radical regulations,” arguing they cost jobs, but that doesn’t mean he will eliminate the Department of Labor's fiduciary rule anytime soon.

According to a panel of financial professionals discussing the DOL rule at Tuesday evening's Nasdaq Advisor Symposium, a Trump administration may delay the rule from taking effect on April 10, 2017, and/or tweak some components but it is unlikely to quash it … yet. In other words, advisors should continue to prepare for the rule’s first enactment in mid-April. Full compliance is not required until Jan. 1, 2018.

6 Parts of a DOL-Friendly Financial Plan

Financial Advisor; November 30, 2016

What’s the most prudent way advisors can act in their own best interest in complying with the Department of Labor's best-interest advice rule? Create quality financial plans documenting and proving that the investment recommendations they make are indeed in their clients’ best interest.

So argues Kevin Knull, president of PIEtech, creators of leading financial planning software MoneyGuidePro, in an interview with ThinkAdvisor. Knull, a certified financial planner, discusses the top 6 components of a top-notch plan, and more.

Will product pricing pressures carry over to advisory fees?

InvestmentNews; Nov 30, 2016 @ 1:20 pm

As low-cost index funds and ETFs continue to take market share from higher-cost actively managed funds, financial advisers could soon find themselves caught up in the downward pressure on fees.

Emily Sweet, senior analyst at Cerulli Associates, said the appeal of passive investing combined with the looming Department of Labor fiduciary rule are putting costs front and center.

“This rule may result in changing investment products, vehicles or account types advisers choose for clients to alleviate any appearance of conflict of interest or negligence of their fiduciary duty to clients,” she said.

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