Labor Department Seeks Delay of DOL Fiduciary Rule

Labor Department Seeks Delay of DOL Fiduciary Rule

The Department of Labor announced that it recently sent in a proposed delay of the DOL fiduciary rule to the OMB. A delay of the rule was expected as the Trump administration has attacked the fiduciary rule since before taking office. However, the recent announcement came from an indirect form. The announcement that the DOL was seeking a delay came from a court document it submitted as part of a lawsuit in the U.S. District Court for the District of Minnesota.

It appears that the DOL will seek an 18 month delay of the Jan.1, 2018 compliance date. This would mean full-implementation would occur on July 1, 2019. It is important to realize that a delay was expected. But, it is what occurs during the delay that will be interesting to watch. According to Professor Hopkins, the delay gives opponents of the rule in the DOL to draft new exceptions and amendments that would significantly water down the current rule. Ultimately, this will be a big win for the variable and indexed annuity providers. As future changes to the rule should provide them with more flexibility to operate under the new standards which rolled out in part in June 2017.

However, it is important to realize that the implementation date has not yet been pushed off. The DOL still has work to do. However, they will likely succeed in delaying the rule.

The WSJ recently quoted Jamie Hopkins about the proposed delay and its implications.

To learn more, click the link below to read the WSJ article citing Professor Jamie Hopkins.

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