The Department of Labor has proposed a rule that would delay the fiduciary rule implementation date by 60 days—from April 10 to June 9 of this year. That will give the agency time to collect and consider information related to issues raised in President Donald Trump’s memorandum on the rule.
The public will have 15 days to comment on the proposal after it’s published in the Federal Register on Thursday. The DOL will accept comments on issues raised in the president’s memo for 45 days.
On Feb. 3, Trump ordered the DOL to undertake an economic and legal review of the pending fiduciary rule.
Despite the delay, many industry executives believe that the market dynamics have already been set in motion with a growing public awareness of the importance of the standard, the dangers of conflicted investment advice, and focus on low-cost investment options. Many brokerage firms, including Merrill Lynch and LPL Financial, have adjusted their business models to comply with the rule and are unlikely to change course.
Brokerage industry advocacy groups continue to push for repeal of the rule. Early last month, a U.S. federal court judge in Texas upheld the DOL fiduciary rule in a lawsuit challenging it. Last week the nine plaintiffs, including the U.S. Chamber of Commerce, the Securities Industry and Financial Markets Association (SIFMA), the Financial Services Institute, Financial Services Roundtable, and Insured Retirement Institute filed an appeal in the U.S. Court of Appeals for the Fifth Circuit.