Skip to content

DOL Fiduciary News: May 17, 2017

Please Note:

These links will take you directly to the homepage of the website that features the article.

To reach the article directly, copy and paste the article title into the search feature on the homepage of the publication website.

For DOL, killing fiduciary rule easier said than done; May 16, 2017

Any effort to delay the June 9 implementation date of the Labor Department’s fiduciary rule will face significant procedural obstacles, and potential legal challenges, according to one administrative law expert.

“It’s not impossible to propose a new delay before the June 9 deadline, but there are substantial hurdles to doing so,” said Bethany Davis Noll, an attorney with the Institute for Policy Integrity at the New York University School of Law.

One hurdle is timing. The first 60-day delay of the rule took about five weeks from start to finish. A little more than three weeks remain before June 9.

Finra chairman John Brennan says DOL rule has raised standard for financial advice

InvestmentNews; May 16, 2017 @ 2:23 pm

Finra chairman John J. Brennan said on Tuesday that even if the Labor Department's fiduciary rule is repealed, it has elevated and put into plain language the idea of providing investment advice that's better for clients' returns than for financial advisers' revenue.

"Whatever happens to DOL, it served its purpose by getting best-interest terminology into the industry," Mr. Brennan, the former chairman and president of the Vanguard Group, said at the annual conference of the Financial Industry Regulatory Authority Inc. in Washington. "Firms should keep on that track. It's going to be the way business is done. The question is whether it is on June 10 or on June 10, 2022."

The DOL regulation, which would require financial advisers to act in the best interests of their clients in retirement accounts, was supposed to be implemented on April 10. That date was pushed back to June 9 so that the agency can reassess the measure under a directive from President Donald J. Trump that could lead to its modification or repeal.

Broker-dealers try to hold the line on advisory and wrap account fees

InvestmentNews; May 16, 2017 @ 4:50 pm

For over a year, CEOs of top broker-dealers have been peppered with questions by analysts who cover their companies about fees. Can firms sustain their current level of fees they charge clients in the new era of the fiduciary adviser? Will they be cut, and by how much?

The popular consensus is that, regardless of whether the Department of Labor's fiduciary rule for retirement accounts takes effect in June, is delayed further or even repealed, fees charged consumers for retirement advice will become more standardized across product lines such as mutual funds and variable annuities. Fees will eventually be pared back, benefiting clients but potentially crimping the bottom line of brokerage firms.

In some cases, this is already happening. In the past 12 months, LPL Financial and Advisor Group announced they were lowering and making standard certain fees on investment products. Meanwhile Merrill Lynch and Commonwealth Financial Network last fall said they would no longer offer commission-based products in retirement accounts, although both firms have given themselves wiggle room over such a change since the DOL rule has been delayed.

Did you accomplish the goal of your visit to our site?

Yes No