In 2010, the Labor Department proposed a change to the definition of fiduciary, under the Employee Retirement Income Security Act of 1974, that would have significantly expanded the scope of those who become fiduciaries. After facing significant objections from various industry groups and financial services companies, the DOL withdrew its initial proposal and began to conduct further analysis.
In February 2015, President Obama announced that the DOL should move forward with its rule making. Two months later, the DOL announced a re-proposal of the rule, which was followed by a period for public comment. The DOL received 3,530 comment letters on its proposal. On January 28, 2016, the DOL sent the final rule to the Office of Management and Budget. The OMB has up to 90 days to complete its review of this significant regulatory action. If approved, the final rule will be published in the Federal Register. Under the Congressional Review Act, “major rules” must be sent to Congress and the Government Accountability Office for review and may not be enacted until 60 days after it has either been received by Congress or published in the Federal Register, whichever is later.
The DOL fiduciary rule is widely expected to have a significant effect on the financial advisers and the firms they do business with.
Keep coming back to this site for the most up-to-date information on the rule and its impact. If you have a suggestion for a story you don’t see here, please contact IN’s editor, Frederick P. Gabriel Jr. at [email protected]