DOL Fiduciary News: June 7, 2016
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DOL official cancels appearance at IRI following industry lawsuit
InvestmentNews; June 6, 2016 @ 1:50 pm
Trying both to stop and comply with a Department of Labor regulation to raise investment-advice standards for retirement accounts has put the financial industry in an awkward situation that was highlighted on Monday in Washington.
Labor Deputy Assistant Secretary Timothy Hauser was scheduled to participate on a morning panel about the rule at an Insured Retirement Institute conference. He abruptly backed out of the appearance late last week, after IRI joined a lawsuit seeking to vacate the rule.
Observers Say DOL Litigation Could Slow Regulatory Guidance
Best's News Service via Bestwire -- June 06, 2016 03:38 PM
WASHINGTON -- Industry observers worry that recently filed litigation to vacate the U.S. Labor Department’s fiduciary rule update could have the unintended consequence of holding up agency guidance that is supposed to help companies comply with the new mandates.
“There is the possibility that the litigation could slow down the guidance,” said Stephen Saxon, chairman, Groom Law Group. “If the guidance has to go through the Department of Justice, that will slow things down quite a bit.”
Ex-DOL Head: Reasonable Compensation Not a Concern
InsuranceNewsNet; June 6, 2016
WASHINGTON, D.C. -- A former Obama appointee reassured industry observers on the fiduciary rule and the future of doing business this morning at the Insured Retirement Institute Government, Legal and Regulatory Conference.
For starters, Seth Harris, former acting Secretary of Labor, said he is unconcerned about how "reasonable compensation" is defined in the rule. Harris was deputy secretary when the initial fiduciary rule was introduced in 2010.
"The courts have worked out what ERISA means by reasonable compensation," said Harris, now a member of Dentons' Public Policy and Regulation practice. "I worry a lot less about reasonable compensation. ... In fairness, my clients do."
Fixed Indexed Annuities Will Survive, Experts Say
InsuranceNewsNet; June 6, 2016
WASHINGTON, D.C. -- Nationwide stands ready to adapt its annuity products to whatever the market demands in the post-DOL fiduciary rule world, said Mike Morrone.
"We will go where the distributor want[s] us to go from a product design perspective. I think some distributors will want it simple and we will have some products that solve that," said Morrone, associate vice president, fixed annuity product strategy, Nationwide Financial Group.
Inside broker and insurance groups' move to block the DOL fiduciary rule
InvestmentNews; June 6, 2016 @ 11:14 am
Professional groups representing the brokerage and insurance industries last week finally broke their silence on the Labor Department's regulation to raise investment advice standards for retirement accounts by filing a lawsuit that could put the rule in limbo.
"We will ask the court to proceed quickly in the case given how burdensome and disruptive the rule is and given the deadlines next year, which require preparation in the near future," said Eugene Scalia, a partner at Gibson Dunn & Crutcher and the lead attorney in the case. The lawsuit aims to vacate the rule and prevent the DOL from implementing and enforcing it.