Regulatory Outlook | 09.23.20
DOL’s Rapid Pace is Too Quick, Many Are Saying
The latest chapter in the ongoing debate concerning investment advice regulation is raising eyebrows from stakeholders on both sides, with sources saying the Department of Labor's (DOL) now lapsed 30-day comment period was insufficient for interested parties to provide proper feedback. DOL on June 29 unveiled a proposed prohibited transaction exemption that would permit investment advice fiduciaries to receive compensation for their advice and to engage in certain principal transactions that are now forbidden. It will likely take months for DOL to finalize the rule. Also on June 29, DOL announced a final rule reinstating the five-part test used to determine whether an investment professional or financial institution is a fiduciary. But now, stakeholders ay they are confused by the current proposal's preamble, specifically the section that deals with the five-part test and rollover advice. A wide swatch of stakeholders have called on the Labor Department to reopen its comment period, saying that 30 days was not enough time to hear from all interested parties, noting that the Sept. 3 hearing was announced only nine days in advance.
Read the full article on Pensions & Investments.