Los Angeles partner Fred Reish was quoted by several media outlets on the OMB’s approval of the DOL-proposed 18-month fiduciary rule delay.
The Office of Management and Budget (OMB) has approved the DOL proposal to push the applicability date for the remaining provisions of the fiduciary rule to July 1, 2019. The delay must now be finalized by the DOL, which will likely provide a short comment period.
In InvestmentNews’s “OMB Approves Proposal for 18-Month Delay of DOL Fiduciary Rule's Second Phase,” Fred stated that the 18-month delay would be reasonable if the DOL coordinates with the Securities and Exchange Commission, FINRA and state insurance commissioners.
“That’s a time-consuming process to work with each of those groups,” Fred said. “The rules will never end up being identical. But I do think they can be made more compatible.”
Fred also noted in the National Law Journal that OMB likely had to “make changes to the economic analysis and maybe the length of the comment period.”
In ThinkAdvisor’s “DOL Files to Delay Fiduciary Rule's January Compliance Date,” Fred added that the three exemptions to the fiduciary regulation are still in effect, “but only the less burdensome transition versions.” “Some of the requirements that were pushed out [under Labor’s request to OMB] are: a contract where the advisor is obligated to comply with BICE, warranties of performance by the advisor (and supervisory entity), disclosures, permission of class-action lawsuits, and so on,” Fred said.
Read “Regulators Approve 18-Month Delay, Postponing Obama's 'Fiduciary Rule.'" (National Law Journal)