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REGULATION/LEGISLATION

Fiduciary rule friends and foes weigh in on proposed delay

The Department of Labor’s proposed 60-day delay of the fiduciary rule’s implementation garnered 565 comments from people pushing for and against the delay.

In addition, 40 House Democrats sent a letter Friday to Acting Secretary Ed Hugler opposing the delay, which they said would only produce “unnecessary and duplicative analysis.”

On March 1, DOL officials proposed extending the effective date to June 9 from April 10, and gave the public until Friday to respond. Once those comments are reviewed, the DOL will submit a final delay rule to the Office of Management and Budget.

The Department of Labor is also taking public comments on President Donald Trump's Feb. 3 memorandum directing it to examine the fiduciary rule to determine whether it may adversely affect the ability of Americans to gain access to retirement information and financial advice.

The 60-day delay is aimed at giving the department time to collect and consider information related to the issues raised in the presidential memorandum, the DOL said.

Many of the 565 commenters noted Mr. Trump’s memorandum in urging a delay. “It would be both disruptive to the marketplace and harmful to Americans saving for retirement” if the rule became effective before the review is done, Empower Retirement President Edmund F. Murphy said in his comment letter. Without sufficient delay, “retirement plan service providers will be required to make material changes to their product and retirement plan offerings only to have to undo or modify those changes if the fiduciary rule is later rescinded or amended.”

Christopher Jones, executive vice president of investment management and chief investment officer of Financial Engines, commented that many in the industry are prepared for the rule, which he said “is helping to accelerate these pro-consumer trends” of making retirement advice cost-effective for advisers and accessible for savers of all means.

David Tittsworth, investment management counsel with law firm Ropes & Gray, said in an email that he would be “extremely surprised if the DOL does not adopt the proposed time extension. While the comments represent a spectrum of views, recent actions all point in the direction of extending the April 10 applicability date.”