DOL Fiduciary Rule Delay is Official

The 18-month from the DOL is now official.  The Transition Period for the Fiduciary Rule’s Best Interest Contract Exemption and the Principal Transactions Exemption will move from January 1, 2018 to July 1, 2019.

During the extended period, fiduciary advisors “have an obligation to give advice that adheres to impartial conduct standards,” said the DOL.

Fred Reish, partner at Drinker Biddle & Reath in Los Angeles, told ThinkAdvisor Monday that while the delay was widely expected, and “gives relief from the most burdensome conditions of the exemptions, it should not be viewed as a delay of the fiduciary rule.”

That rule, Reish continued, “applied on June 9 of this year and will continue to apply during the extended transition period–until July 1, 2019 and probably thereafter. In addition, advisors must comply with the Impartial Conduct Standards during the transition period, which are: the best interest standard of care, no more than reasonable compensation and no materially misleading statements. The burden of proving compliance with those Standards is on the advisor and the advisor’s supervisory financial institution and therefore compliance should be documented.”

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