If you’re like us, you rejoiced last Friday (Feb 3, 2017) as you watched President Trump sign the Executive Order effectively taking a stand to dismantle the DOL Fiduciary Rule that has been on the minds’ of Financial Advisors across the country for over a year. We sighed a sigh of relief as we thought eliminating the impending rule would save us headaches, hurdles, and “Unintended Consequences”.
However, upon second glance of the Executive Order, we realized Trump’s signing may have just delayed the rule, not killed it.
Law Firm, DrinkerBiddle, specializes in providing regulatory and business solutions and are DOL Specialists. Our contact, Counsel Joan Neri of DrinkerBiddle, sits on an NFS round-table Group with our Chief Compliance Officer, Barry Champney. Yesterday, Joan sent us an analysis published by DrinkerBiddle that delves into the current status of the rule, to clarify the confusion – dead or delayed?
Dead or Delayed?
Their analysis points to delay. They believe we will be receiving a statement from the DOL Secretary in the near future, announcing the probability of delaying the April 10th effective date. (Note: Trump has selected Andrew Puzder as the nominee for DOL Secretary but has not yet been confirmed)
DrinkerBiddle also explains the consequences to a delay, and how it will affect financial professionals. Generally speaking, in the event of delay financial professionals can breathe easy for a few more months by going about their business in accordance with current regulations.
However, other possibilities are that the DOL can put the rule into effect as drafted, with new modifications, or pull the rule completely. We must also keep in mind that there are a few bills currently circulating Congress that could be seen as alternative solutions or replacement s to the DOL Rule.
In their own words, DrinkerBiddle says, “The reality is that we are in a period of uncertainty, but for the moment, we think that advice to plans, participants and IRAs will be subject to the ‘old rules’.”
Click below to read DrinkerBiddle’s full analysis.