The Trump administration is seeking to push back the implementation of the “fiduciary rule” designed to protect US retirement savers by 60 days.
The US Department of Labor has already been ordered by President Donald Trump to consider scrapping the controversial Obama administration rule, but with its go-live date looming on April 10, the department on Wednesday moved to give itself more time to conduct that review.
In a notice requesting comment on the proposed delay, the DoL said:
Absent an extension of the applicability date, if the examination prompts the Department to propose rescinding or revising the rule, affected advisers, retirement investors and other stakeholders might face two major changes in the regulatory environment rather than one.
Financial advisers, broker-dealers and asset managers have been awaiting guidance from the new administration about whether they should halt their preparations for the new rule, which requires retirement advisers to put clients’ interests ahead of their own. Critics say it puts too heavy a compliance burden and opens up advisers to the risk of class action lawsuits, something that will likely lead to fewer Americans having access to financial advice.
The industry has largely moved to comply with the rule, however, since parts of it went into effect last year, and it encourages trends that are already well established, including the shift from commissions to fee-based advisory accounts.
The original enforcement date was April 10. Companies wishing to comment on the proposed delay have a little over two weeks to do so, before final confirmation. It is unclear how long the DoL review will take to decide whether to change or scrap the rule entirely.