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DOL Fiduciary News: May 5, 2015

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The DOL fiduciary rule's effect on small broker-dealers 

InvestmentNews; May 4, 2016 @ 11.21 am

The rule opens the door to future customer litigation and opportunity for regulators to impose sanctions or fines on smaller broker-dealers. In the current regulatory landscape, small to midsize broker-dealers are subject to an ever-increasing regulatory burden. The new Department of Labor fiduciary rule simply adds fuel to that fire. 

Some Annuity Execs Say DOL Rule Prevents Independent Agent Sales

InsuranceNewsNet; May 4, 2016

An insurance company executive at one of the top fixed indexed annuity sellers cast doubt on an insurance company’s ability to police and supervise independent agents selling financial products into retirement accounts.

S. Craig Lindner, co-CEO of American Financial Group in Cincinnati, said that unless an insurance company decides to take on the fiduciary obligation of the distribution, insurance companies do not necessarily assume fiduciary liability. Lindner made his comments in an earnings call on Tuesday. Great American Insurance Group is a subsidiary.

DOL Rule Won't Disrupt Business, Say Fiduciary Advocates 

Financial Advisor; May 4, 2016

Advisors shouldn’t see a major disruption of their businesses as a result of the DOL fiduciary rule, according to several members of the Committee for the Fiduciary Standard.

“There will be a little more documentation, but [the rule is] not to prevent us from doing business,” said Deena Katz, associate professor in the personal financial planning program at Texas Tech University. “It’s not going to stop us from doing commissions. … It isn’t going to change your business model unless you intend to.”

How to sell fixed indexed annuities in a DOL fiduciary environment

InvestmentNews; May 4, 2016 @ 1.29 pm

Many providers of fixed indexed annuities and advisers who sell them were caught off guard when the Labor Department failed to exempt them from a fiduciary standard under the department's new rule.

As advisers now weigh how to make recommendations of indexed annuities without running afoul of the rule, they can look to specific text of the regulation to glimpse what factors the Department of Labor would consider as part of a prudent recommendation.

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