Los Angeles partner Fred Reish was quoted in a ThinkAdvisor article titled, “Details Emerge on Trump Order to ‘Review’ Fiduciary Rule.” President Trump signed an executive order on February 3 asking the Labor Department to undertake an assessment of the fiduciary rue and, if it deems appropriate, issue a proposal to revise the rulemaking, which would delay the April 10 effective date.
Fred notes that the order curiously does not direct the DOL to extend the applicability date of the rule; however he assumes that the department will automatically delay the April 10 date to allow sufficient time to do the analysis. After performing an updated economic and legal analysis, the DOL is directed to propose a new rule rescinding the rule, revising the rule or proposing revisions to the related prohibited transaction exemptions.
“My predictions would be that the applicability date will be delayed; there will be a finding that the rule does adversely affect investors and retirees; and the rule will be revised," Fred said. He also stated he thinks most of the focus of the evaluation will be on the requirements of the Best Interest Contract Exemption.