THE DOL SPOKE (in DOL speak). BREAKING NEWS 4-4-17, 46B00 EST:
Today, in a major announcement with their customary clarity of a catfish pond, the DOL made a Fiduciary Rule announcement. Saying “no, we really mean it this time” the Department of Labor said, “the Fiduciary Rule will now become effective AS IS on June 9 this year.” Then they said, “Still we are going to review it in its entirety and by January 2018, we may just decide to rescind the damn thing”
“Now you see it, now you don’t. Keep your eye on the pea” (my edits), but it could be the DOL.
Unfortunately, it’s NOT April 1.
While saying theyʼre extending the fiduciary rule and related prohibited transaction exemptions for 60 days, (to June 9, 2017), they, in the same breath, said they decided that a review of the rule would take longer than the 60 day extension. ?? So the rule will become effective June 9, WITHOUT FURTHER DELAY ! ??? (bets available where legal). They also said, in customary DOL rationale, that they concluded some delay in full implementation of said rule is necessary. ???? Backing up a bit they rationalized that to further delay the April 10 implementation date (beyond June) would be chaotic for the firms that have been going forward with fiduciary standards (both of them). No, iʼm sure itʼs more than Morgan Stanley and Merrill Lynch who both just a few hours before the DOL blockbuster announced they were going ahead with fiduciary standards on April 10.
Our DOL went further in saying that any more delay would cause “ongoing injury to retirement investors” and more delay couldnʼt possibly be justified because those retirement investor losses would “quickly overshadow” and additional compliance cost savings by those other financial firms.
Backpedaling some more, the DOL said this announcement balanced the Retirement investorsʼ protection intent with the Presidentʼs explicit instructions to “look hardly” at those “potential undue burdens.” They also admitted something like, “we all agree, but not everybody does.” (my words).
Then they said that they will perform the examination of the rule as required by the President in full by January 1, 2018. At that time, they may:
1. Extend it some more.
2. Make significant changes.
3. Make some general changes, or
4. Scrap the rule (my words).
Finally they further clarified that compliance with covered transactions other than the fiduciary (best interest) aspect and the prohibited transaction is not required until January 1, 2018. Iʼm glad they finally cleared all that up for us. Arenʼt you? Oh: Advisor, Broker, Insurance agent:
WHAT DO YOU DO?? The answer is: COMPLY. Just like they said.
For details see https://www.federalregister.gov/d/2017-06914