09.08.20
DOL Advice Proposal Criticized by Both Sides at Hearing
by: Mark, Jr. Schoeff
Investor advocates and financial industry representatives on Thursday criticized a DOL proposal to revise investment advice rules for retirement accounts. During an online hearing, witnesses expressed concerns about a five-part test that would determine whether a retirement plan advisor is a fiduciary under federal retirement law. The test, which was established more than 40 years ago, was reinstated in the preamble to the proposal after being scrapped by the now-vacated fiduciary rule enacted under the Obama administration. The DOL's current proposal would align with the SEC's Regulation Best Interest. Investor advocates said the five-part test was more like a sieve and would allow too many financial advisors to avoid ERISA fiduciary requirements. Financial industry reps said the test was too expansive and would trigger fiduciary responsibility for too many advisors who were conducting financial transactions rather than giving investment advice.
Read the full article on InvestmentNews.