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DOL Fiduciary News: July 20, 2017

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House panel passes bill to replace DOL fiduciary rule with one requiring disclosure of conflicts

InvestmentNews; July 19, 2017 @ 5:02 pm

In a party line vote, the House Education and the Workforce Committee approved legislation on Wednesday that would kill the Labor Department fiduciary rule and replace it with an advice standard based on disclosure.

It wasn't the only effort in the House on Wednesday to take the DOL rule off the books. Later in the day, the House Appropriations Committee was expected to approve a DOL spending bill ( that would prevent the agency from funding the enforcement of the fiduciary rule.

The disclosure bill also likely will be voted on by the House Ways and Means Committee before it is taken up by the full chamber. Meanwhile, the House Financial Services Committee also is working on legislation that would eliminate the DOL rule and replace it with a best-interest standard outlined in that bill that would be proposed by the Securities and Exchange Commission.

Panel: DOL Rule Will ‘Most Certainly’ Be Delayed

InsuranceNewsNet; July 19, 2017

Phase two of the controversial Department of Labor fiduciary rule will almost certainly be delayed beyond Jan. 1, panel convened by The American College agreed today.

However, panelists cautioned, that does not mean the fiduciary standard is going away. It does mean that smaller changes could yield big dividends for the industry. For example, the right for clients to class-action lawsuits could be removed.

Additional prohibited transaction exemptions are likely that better reflect the product development that has taken place, said Jamie Hopkins, director of retirement planning at The American College in Bryn Mawr, Pa.

‘Fiduciary’ Rule Accelerates Account Shift across Brokerage Industry

The Wall Street Journal; July 19, 2017 3:54 p.m. ET

A new retirement-savings rule that began to take effect last month is already having an impact on the brokerage industry, helping push up fee-based assets at the big full-service firms and drive up assets in self-directed accounts at discount firms.

Wall Street brokerages Morgan Stanley and Merrill Lynch said fee-based assets grew 17% and 19%, respectively, in the second quarter from a year earlier. At TD Ameritrade Holding Corp., which caters to investors seeking to manage their own investment accounts, new client assets in the latest period climbed to a record $22 billion from $13.6 billion a year ago.

Rising fee-based assets and flows into self-directed accounts highlight a shift that has been playing out across the wealth-management industry in recent years. Firms are increasingly ushering clients’ money into accounts that generate fees, which offer steadier and more-predictable revenue than commission-based accounts.

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