In a move bound to cheer opponents of the Department of Labor’s ( DOL ) controversial, pending fiduciary rule, the DOL on Wednesday proposed delaying the “applicability” – that is, implementation – of the new rule for 60 days. The proposed postponement would allow the DOL to review the fiduciary rule as called for by President Trump on Feb. 3, and could lead to its revision or replacement.
The rule would require brokers and advisors to recommend investments that are in the best interests of clients, not merely suitable for them, when they give retirement account advice. That is how fiduciaries are obligated to act. As a result, the new rule would require brokers and advisors to put their clients’ best interests before their own profit.
The controversial rule had been slated for implementation on April 10.
Now there will be a 15-day comment period on the proposed delay of implementation, starting from when the new proposal is published in the Federal Register. That’s scheduled for Thursday.
Trump’s memo directing DOL to restudy its proposed fiduciary rule could lead to revision of or killing the rule if DOL finds that it harms investors or financial firms in certain ways.
The new postponement proposal also asks for a 45-day comment period.
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