The Department of Labor has delayed by 60 days the applicability date of the long-debated Fiduciary Rule. The rule was to be effective April 10 and now becomes effective June 9, 2017, absent repeal or other delays. The delay is to give the DOL time to collect information and consider issues raised by President Trump in his order of the review of the rule.
Brokerage industry executives have fervently fought the adoption of the rule. The rule generally mandates that all financial professionals, when giving advice to clients with retirement funds, act in “the best interest of their clients.” Currently, brokers may employ the lesser “suitability” standard in working with a client’s retirement plan assets.
In our view, the proverbial horse is out of the barn and the long-term trend is toward a fiduciary standard. Whether the rule is further delayed or repealed, we believe that clients will insist on working with financial professionals who operate under the “best interest” fiduciary standard. We believe that the DOL’s Fiduciary Rule for retirement assets is simply the right thing to do whether it becomes law or is further delayed or repealed.