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DOL Fiduciary News: September 22, 2017

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Regulatory ‘Mess’ as States Enter Fiduciary Fray

ThinkAdvisor; September 21, 2017

ERISA attorneys say that the bevy of states that are coming out with their own fiduciary standards are creating a regulatory “mess.”

“The states are responding to both the inaction of the SEC to come up with a uniform standard and projected action on part of the DOL – mainly [Labor Secretary Alexander] Acosta in rolling back some of the fiduciary rule,” George Michael Gerstein, a lawyer with Stradley Ronon Stevens & Young in Washington, told ThinkAdvisor in a Wednesday interview.

“Because broker-dealers are not subject to a formal federal fiduciary duty, some states may be seeking to impose a state fiduciary duty on them,” added Larry Stadulis, partner at Stradley Ronon.

For instance, Nevada’s law is unique in that it not only says advisors are fiduciaries when dealing with retirement and non-retirement plans, but “expressly deals with disclosure, recordkeeping, as well as an ongoing duty to monitor that potentially goes beyond, and differs from, what’s required under federal law, though the anticipated regulations should clarify these issues.”

New Group Lobbies DOL on Fixed Indexed Annuities’ Treatment under Fiduciary Rule

ThinkAdvisor; September 21, 2017

Annuity supporters are fighting to ensure that fixed indexed annuities get treated the same as other fixed annuities and not lumped in with securities products under the Department of Labor’s fiduciary rule.

The newly formed group, the Fixed Annuity Consumer Choice Campaign, or FACC Campaign, is gathering signatures for a petition to be sent to Labor Secretary Alexander Acosta “urging him to delay implementation” of the fiduciary rule exemptions to July 1, 2019, and “fix the treatment of fixed indexed annuities.”

More than 1,800 signatures have been received so far, the group said.

As it stands now, fixed indexed annuities fall under the fiduciary rule’s best-interest contract exemption, or BICE.

NAPFA: Full DOL Fiduciary Rule Will Be Tough to Derail

Financial Advisor; September 21, 2017

The National Association of Personal Financial Advisors will continue to advocate for full implementation of the Department of Labor fiduciary rule, even as the department delays part of the rule, says Geoffrey Brown, NAPFA’s CEO.

Although the Trump administration has been less than enthusiastic about the fiduciary rule, which requires broker-dealers and advisors who handle retirement plans to put the best interests of their clients first, Scott Beaudin, the new chair of the NAPFA’s board of directors, says the parts of the rule that have already been implemented would be difficult to undo.

In a wide-ranging interview with Financial Advisor, Brown and Beaudin offered their perspectives on a variety of subjects. Of the new regulations, Brown says both the DOL and the Securities and Exchange Commission’s efforts to make the financial services profession more accountable are steps in the right direction.

Are clients, and your book of business, ready for decumulation?

Financial Planning; September 21 2017, 5:24pm EDT

The decumulation phase is a major life transition for clients, in ways they may not be considering, as well as a new business phase for most advisors. As with any big transition, though, there’s opportunity.

Navigating this new phase so both the client and advisor can benefit was the topic of the most recent Financial Planning webinar. Rob Comfort, President of CUNA Brokerage Services, and Sheryl Rowling, head of Rebalancing Solutions for Morningstar and principal of Rowling & Associates, discussed how advisors can best to prepare their practices and clients for this next stage.

Both panelists agreed that going beyond the traditional advisor/client relationship is paramount for a successful practice and a more enjoyable retirement for your client.

“Not only is it going to be good business, or necessary business to get to know clients more at a life level, especially retired clients or pre-retired clients, I think it’s something that the regulators are going to expect,” Comfort said.

Taking into account the spirit of the DoL rule and looking at where the business is heading, having a more life-focused interest in clients and what is important to them on a deeper level, beyond their financial needs, is going to be “critical for success” in the future, Comfort says.

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