Los Angeles partner Bruce Ashton was quoted in a Financial Planning article titled “States’ Rescue of Fiduciary Rule Could Backfire.” Some states, such as Nevada, have begun drafting their own fiduciary standards in an effort to increase fiduciary protections in light of the Trump administration’s attempt to weaken the Department of Labor’s fiduciary rule.
The rule’s remaining features—including an enforcement mechanism—will go into effect in July 2019. Nevada recently passed a law that will expand the number of financial planners who are subject to a fiduciary standard. Several business groups and trade organizations have already voiced criticism of the new regulation.
Bruce noted that states’ adoption of their own fiduciary regulations could make compliance for national firms “very complicated and expensive.” He suggests that states adopt a position that deems firms and advisers to be in compliance if they meet the federal standard, rather than a state’s standard.