Displaying items by tag: fiduciary rule

Monday, 20 December 2021 18:26

SEC Launches New Industry Crackdown

The Security and Exchange Commission just issued a slew of new regulatory changes that would impact current trading standards. New changes could come into vote if they have majority support among the five commissioners and two others. Chairman Gensler stated he wants the public and markets to have fair material information. Essentially there is no public disclosure form when a plan to schedule share purchases takes place which can ultimately give insiders an advantage on the trading block. The research in academia has confirmed these trades are more beneficial in the ability to avoid losses inside a 60-day window.


FINSUM: These changes could lead to substantially less stock buyback plans in the coming years as insiders could face more symmetric returns.

Published in Wealth Management
Thursday, 16 December 2021 22:14

New Tough Fiduciary Rule Likely Delayed

Biden recently made his pick for a critical new position at the DOL: head of the Employee Benefits Security Administration. Lisa Gomez has been nominated and is likely to get bipartisan confirmation. Gomez is seen as critical to the redrafting of the fiduciary rule that is taking place at the DOL. Most industry insiders expect the new version of the fiduciary rule to be much tougher, more akin to the original Obama era rule than the currently in-effect Trump version.


FINSUM: The reality is that if a critical new person is being brought on board to lead the effort, it is likely to push back the timeline, or so says Brad Campbell, leading regulatory lawyer at Faegre Drinker, a leading law firm in our space.

Published in Wealth Management
Wednesday, 08 December 2021 22:17

Biden's Big Addition to the New Fiduciary Rule

Sweeping changes to the financial regulatory landscape are coming quickly. Stemming from changes to the interpretation of a Trump-age exemption are widening the regulatory umbrella. The U.S. The Labor Department is pushing a variety of accounts including annuities to be included in this expansion. Hidden and/or lofty fees in these areas are the source of the concern and lawmakers want the ‘best interests’ of investors in mind. Many companies are sprinting to align themselves with the regulation. Complying will include recordkeeping requirements, new policies and procedures, and new disclosures.


FINSUM: The drastic changes to regulation will really start to come in at the start of the year, and could monumentally alter the annuities market.

Published in Wealth Management
Monday, 29 November 2021 19:29

An Obama-like Fiduciary Rule Arriving Soon

According to the leading regulatory lawyers in our industry, advisors are about to get hit with a doozy. Faegre Drinker Biddle & Reath say that the DOL is planning to release a new fiduciary rule this spring. Since the new version of the rule is being drafted and put forth under the Biden DOL, it is widely agreed that this newest version will look much like the Obama-era rule that got thrown out by the courts. According to Fred Reish, a partner at the firm, “There will be provisions of 2020-02 that'll be moved over to it. Probably the fiduciary acknowledgement, the best interest standard and maybe specific disclosures of reasonable compensation limitation. It'll look a lot more like a fiduciary type rule than it does right now."


FINSUM: This new rule has been widely signaled but we have never had a good fix on timing, but is now becoming clear. Take note.

Published in Wealth Management
Tuesday, 26 October 2021 20:22

The DOL is Delaying the Fiduciary Rule

The DOL took a very important and surprising step today. Many advisors and the industry more generally has been calling for the DOL to delay their implementation of the Fiduciary Rule, and somewhat amazingly, that is exactly what the agency just did. Referring specifically to the rule that was passed in the final few weeks of the Trump administration, the DOL is delaying implementation until the end of January 2022. Further, it will not enforce several parts of the rule, including the rollover aspect, until June 2022.


FINSUM: So the month extension isn’t that big, but will give some firms more time to get their matters in order. The bigger question is when the new Biden era DOL rule be implemented.

Published in Wealth Management
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