Dept. Of Labor Proposes Delaying Rule That Brokers Work In Clients' Interest
Source: Talking Points Memo
By MATT SHUHAM Published MARCH 1, 2017, 1:16 PM EDT
The Department of Labor announced Wednesday that it would consider delaying the implementation of a new fiduciary rule, part of which requires that retirement brokers provide investment advice in their clients best interest.
After a 15-day period for public comment period beginning Thursday, the department could choose to extend the implementation of the rule originally slated to go into affect on April 10 until June 9.
A Department of Labor press release cited a Feb. 3 executive order from Donald Trump to justify the proposed delay. In it, Trump argued that the new regulation, pursued aggressively by the Obama administration, may significantly alter the manner in which Americans can receive financial advice, and may not be consistent with the policies of my Administration.
In the order, Trump also asked the Labor Department to consider whether the rule is likely to cause an increase in litigation, and an increase in the prices that investors and retirees must pay to gain access to retirement services.
Read more: http://talkingpointsmemo.com/livewire/department-of-labor-fiduciary-rule-delay-trump
IronLionZion
(45,275 posts)can get someone elected president. It's a strategy that seems to work for some.
malthaussen
(17,068 posts)Well, they already don't if it's against their "sincerely-held religious belief."
How can any reasonable human being justify this? Ah, of course, it's all about liability.
-- Mal
angrychair
(8,594 posts)I know it's a little hyperbole to make a point but it's not that much of a stretch and I'm sure someone could craft a legal argument to support it given this administration l's legal stance. It is not that great leap. These are very interesting times and that is not always a good thing.
elleng
(130,175 posts)They've fought that one from the beginning.
mahatmakanejeeves
(56,910 posts)....
The department will accept public comments on the proposed extension for 15 days following its publication. Comments on issues raised in the presidential memorandum will be accepted for 45 days.
The proposal will be published in the March 2, 2017, edition of the Federal Register and can also be viewed on the Employee Benefits Security Administrations website, https://www.dol.gov/ebsa/ .
https://www.federalregister.gov/documents/2017/03/02/2017-04096/definition-of-term-fiduciary-conflict-of-interest-rule---retirement-investment
https://s3.amazonaws.com/public-inspection.federalregister.gov/2017-04096.pdf
ADDRESSES: You may submit comments, identified by RIN 1210-AB79, by one of the following methods:
Federal eRulemaking Portal: http://www.regulations.gov . Follow the instructions for submitting comments.
Email: [email protected]. Include RIN 1210-AB79 in the subject line of the message.
Mail: Office of Regulations and Interpretations, Employee Benefits Security Administration, Room N-5655, U.S. Department of Labor, 200 Constitution Avenue NW, Washington, DC 20210, Attention: Fiduciary Rule Examination.
ProfessorGAC
(64,439 posts)Why are they the enforcement arm? Shouldn't it be Treasury or Commerce?
pat_k
(9,313 posts)Which puts it in the the DOL bailiwick.
Yupster
(14,308 posts)It's turned the industry upside down.
DU'ers may have been told recently that their 401 k's are switching to new companies as some have chosen to leave the business rather than try to comply with the 2800 page regulation.
Large companies have hundreds of people at their home offices in working groups trying to figure out how to comply.
Here's the problem. The standard has always been suitability. A broker has to recommend investments that are suitable to you as to age, income, net worth, risk tolerance.
The new standard is "in the client's best interest."
So you go to your broker to contribute $ 5,000 to your IRA. The broker says you can buy a CD, a bond, a stock or a mutual fund. You can buy Exon stock or a Gold ETF.
So which one is in the client's best interest?
Ask me in 10 years and I'll look back and tell you. In the meantime, I have no idea and neither does anyone else. It's left the companies in a frenzy trying to figure out what to do.
Other features is that the broker must make the same amount of money regardless of which investment choice the investor chooses and a retirement plan must accompany each retirement account and be updated each year.
What companies have decided was to make managed money accounts where you pay an annual fee (1 % a year?) which is way more than you'd pay by having a portfolios of stocks or bonds. Also, small investors will lose their brokers as a $ 2,000 account won't be worthwhile with the meeting requirements.
So, there's a lot more to this than putting the clients' best interests first. Hopefully your broker has been doing that all along just like your doctor, dentist, plumber and teacher. For those who aren't, let's go after them.
pat_k
(9,313 posts)mahatmakanejeeves
(56,910 posts)The docket is up at Regulations.gov. You can submit comments here. Use the search term "RIN: 1210-AB79".
Definition of the Term Fiduciary; Conflict of Interest RuleRetirement Investment Advice
lagomorph777
(30,613 posts)...until we get rid of the
Secretary of Union-Busting
Secretary of Ignorance
Secretary of Offense
Secretary of Sickness and Inhumane Abuses
Secretary of Looting the Treasury
EPA Dismantler
Secretary of Homelessness and Urban Decay
and so on