Regulators are seeking to delay the deadline for financial advisers to fully comply with a rule that would require them to act in their customers’ best interest, according to a federal court filing on Wednesday.
The Labor Department, which sent the proposal to the Office of Management and Budget, said it wanted to push back the full implementation of the so-called fiduciary rule to July 1, 2019, from January 1, 2018, according to a court document filed in Federal District Court in Minnesota.
The first part of the fiduciary rule took effect in June, and requires brokers, financial advisers and insurance agents to put their customers’ interests ahead of their own, at least when they are handling their retirement accounts.
But the final pieces that are not yet in place are what gives the rule its teeth: Among other things, the rule would require financial professionals with conflicts of interest to sign a contract with customers, making the rule legally enforceable. …
EPI: Another Fiduciary Rule Delay Would Cost Retirement Savers $10.9 Billion Over 30 Years
Reprinted from the Economic Policy Institute by Heidi Shierholz on August 10, 2017.
The Trump administration’s Department of Labor is actively working to weaken or rescind the “fiduciary” rule (the rule that requires financial advisers to act in the best interest of their clients). The latest step in these efforts is a proposed 18 month delay of key provisions of the rule past their already-delayed implementation date of January 1st, 2018.
An additional 18-month delay would be enormously expensive to retirement savers. Previously, we estimated that the delays the department has already instituted under the new administration mean that retirement savers will lose $7.6 billion over the next 30 years. Using the same methodology, we estimate that an additional 18 months of delay of key provisions in the rule announced yesterday will cost retirement savers an additional $10.9 billion dollars over the next 30 years. …