DOL Posts Hundreds of Comments Following Rule Delay
Hundreds of comments have flooded the Department of Labor since it proposed to delay the fiduciary rule earlier this month and opened the proposal to public comment, according to InsuranceNewsNet.
As of the middle of last week, the agency had already posted 285 comments, roughly evenly divided between opponents and supporters of the rule, which purports to require retirement brokers to put clients’ interests ahead of their own and was scheduled to go into effect in April, the web publication writes. At the beginning of March, the DOL opened the public comment period on its proposal for a 60-day delay of the rule following a memorandum from President Donald Trump directing the agency to review the rule.
Opponents of rule, including prominent GOP lawmakers and several financial industry groups, have argued that the rule will squeeze out less-wealthy retirement savers from being able to afford financial advice. Many of the comments pouring in stress much the same sentiment. One commenter, for example, writes that advisors can’t risk a lawsuit on accounts that barely generate any fees, InsuranceNewsNet writes. And Henry D’Alberto of American Financial Associates writes that he would need to sell his firm to a larger group to afford the costs of complying with the rule, according to the web publication.
Those writing in support of the rule include investors and several fee-only advisors, as well as the head of the largest independent robo-advice firm, InsuranceNewsNet writes. Jon Stein, founder and CEO of Betterment, writes that while not perfect, “the fiduciary rule is the only realistic hope for prompt action to improve the quality of retirement advice,” according to the web publication.
An investor, meanwhile, writes that he’s disturbed that there’s no legal recourse for him if an advisor chooses to put his assets into a fund that delivers smaller returns but more revenue to the advice firm, InsuranceNewsNet writes.
The DOL is accepting comments on the proposal to delay the rule until March 17, according to the web publication.