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DOL Fiduciary News: March 16, 2017

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Financial Planning Coalition: DOL fiduciary rule delay harms investors, violates regulatory requirements

InvestmentNews; Mar 15, 2017 @ 6:14 pm

Delaying the Department of Labor's fiduciary rule would harm investors and violate regulatory requirements, groups representing investment advisers asserted in a comment letter on Wednesday.

The Financial Planning Coalition said that the proposal to push back implementation of the regulation for 60 days would cause investors to lose money over that period due to conflicted advice. It also asserted that the DOL failed to follow the Administrative Procedure Act in promulgating the delay rule.

Merrill Lynch outlines plans for its 401(k) fiduciary platform

InvestmentNews; Mar 15, 2017 @ 5:41 pm

Merrill Lynch Wealth Management outlined plans Wednesday to transition its defined-contribution-plan business over to a fiduciary model, coming several months after the firm announced similar plans for its retail retirement business and as the implementation deadline for the Department of Labor's fiduciary rule approaches.

Broadly, the wirehouse said advisers servicing DC plans of a certain size will, after a yet-to-be-determined date, be a fiduciary when providing advice or recommendations for a retirement plan's investment menu.

As Fiduciary Rule Gets Reviewed, Class-Action Provision Is Under Microscope

The Wall Street Journal; March 15, 2017 3:48 p.m. ET

If the fiduciary rule survives a Labor Department review, it might do so without its teeth.

The so-called right of private action in the fiduciary rule—which would require stewards of retirement accounts to act in clients’ best interest—significantly increases the ability of savers to bring possible class-action lawsuits against brokers whom they say have violated their fiduciary duty. While class-action suits don’t typically yield big paydays for plaintiffs, the threat of such litigation was included in the fiduciary rule to effectively serve as the regulation’s main enforcement mechanism.

A.M. Best Briefing: Future of Department of Labor’s Fiduciary Rule Remains Uncertain

March 15, 2017 09:30 AM EDT

OLDWICK, N.J. -- (BUSINESS WIRE) -- Based upon discussions with insurers expected to be impacted by the U.S. Department of Labor’s fiduciary rule, A.M. Best notes that the vast majority of these companies are moving ahead with implementation, despite the ongoing uncertainty given President Donald Trump’s lack of support for the guidelines.

A Best’s Briefing, titled, “Future of the Department of Labor’s Fiduciary Rule Remains Uncertain,” states that to date, the final deadline of Jan. 1, 2018, which is when all requirements of the rule must be met, should not be affected by a current delay of the initial compliance deadline to June 9, 2017, from April 10, 2017—a result of a recent directive from the Trump administration. The DOL’s fiduciary rule essentially expands the responsibilities of financial professionals to that of a fiduciary and impact levels of compensation, mainly commissions. Given the relatively short duration of the delay, it is possible that the ruling might be further extended beyond the 60-day timeline, particularly since a new Labor Secretary has not yet been confirmed.

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