IAA Alert: February 3, 2017 - IAA Alert: Trump Memo Reopens DOL Fiduciary Rule


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Trump Memo Reopens DOL Fiduciary Rule, Acting Labor Secretary Will Consider Delaying Effective Date

February 3, 2017: President Trump issued a memorandum asking the Department of Labor (DOL) to re-evaluate the economic and legal basis for its fiduciary rule and determine whether the rule should be amended or completely rescinded. The rule is currently scheduled to take effect on April 10.

Contrary to reports following the White House signing ceremony (including an earlier IAA Member Alert), the memo does not explicitly direct the DOL to delay implementation of the fiduciary rule by 180 days – something that was not clear until the Administration released its official memo late Friday. Nevertheless, Acting Labor Secretary Ed Hugler issued a statement following the official release of the memo saying, “The Department of Labor will now consider its legal options to delay the applicability date as we comply with the President’s memorandum.”

The official memo directs the DOL to prepare an updated economic and legal analysis concerning the impact of the fiduciary rule, which must consider whether the rule is likely to reduce access to retirement savings offerings or financial advice, cause dislocations or disruptions within the retirement services industry, or increase litigation and an increase in the prices that investors and retirees must pay to gain access to retirement services.

Based on that review, if the answer to any of those questions is yes – or if DOL officials conclude for any other reason that the fiduciary duty rule is inconsistent with Trump Administration policy – the memo states the DOL should publish for public comment a proposed rule rescinding or revising the fiduciary rule.

The DOL’s fiduciary rule will be one of the topics covered in an IAA policy briefing for members on February 9. Members can register to join that briefing call, The Regulatory Landscape for Advisers: The Only Certainty is Change, by clicking here.

The rule will also be discussed in two separate breakout sessions at the IAA’s 2017 Investment Adviser Compliance Conference in Washington, D.C. on March 2-3.

IAA members can visit the IAA Alert page in the Members Only section of our website or contact staff for more information.

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