On June 9, 2017, after years of study, review, and planning, major provisions of the fiduciary rule went into effect. The rule requires anyone providing investment advice to retirement savers or employee retirement plans to offer advice that’s in the client’s best interests, not the adviser’s.
But last night, Donald Trump’s Labor Department published a Request for Information (RFI) that makes it clear that their loyalties lie with Wall Street, not America’s retirement savers. The RFI seeks public input on delaying the date at which the rule becomes fully applicable beyond January 1, 2018, along with information that “could form the basis of new exemptions or changes/revisions to the rule.” In other words, DOL is searching for justification to delay full implementation of the current rule and propose a new, weaker rule. This is harmful, unnecessary, and a colossal waste of taxpayer money.
DOL has already carefully considered the evidence and has reviewed studies and comments from all sides. Any changes to the rule will simply weaken it, and allow unscrupulous financial advisers to continue to fleece their unsuspecting clients. Further, the windows for providing responses—15 days for responses related to the delay and 30 days for responses about how the rule should be revised—are so short that they seem to be designed to preclude the department from receiving any meaningful input.
Conflicts of interest cost retirees at least $17 billion each year in charges and fees. Workers saving for retirement and retirees trying to make ends meet in all 50 states would clearly benefit from the fiduciary rule being fully implemented without delay. Only the financial industry would benefit from further slowing down or weakening the rule.