Democratic Senators Recommend Fixes to the Proposed DOL Fiduciary Regs (with Lofchie Comment)

In a letter to the Department of Labor, Democratic members of the Senate Finance Committee made numerous recommendations regarding the re-proposed regulations defining who is a fiduciary of an employee benefit plan or individual retirement plan under ERISA."

The Senators recommended that the DOL: (i) clarify the "best interest contract ("BIC") exemption" by utilizing a more workable contract requirement and include listed options in the definition of assets; (ii) expand the capability of financial professionals to provide specific investment education on retirement plans; (iii) continue to encourage small businesses to sponsor their own small retirement plans; (iv) revisit the BIC exemption disclosure requirements to ensure functionality; (v) continue access to investment advice from financial advisers during rollover period; (vi) provide a level playing field for all advisers in compensation arrangements; (vii) carefully scrutinize its guidance to ensure that it does not disfavor lifetime income options over other investment options; (viii) consider further transition issues, such as the possible protection of advice provided before the applicability date and advice that was paid for before the applicability date but not provided until after the applicability date; (ix) continue coordinating with the IRS to work towards finalizing IRA guidance; and (x) ensure that the ability to make referrals to advisory programs is maintained and access to constructive online tools is not restricted.

Lofchie Comment: The Senators' letter is a further expression of the diversity and the extensive strength of opposition to the DOL's rule proposal.

See: Democratic Senators' Letter Regarding Comments on Proposed Regulations on Definition of the Term "Fiduciary."

Related news: SIFMA Raises Concerns About Complexity and the Proposed Fiduciary Rule (August 10, 2015); Democratic Senators Highlight Costs of DOL Fiduciary Proposal (with Lofchie Comment) (August 7, 2015); ICI Recommends That DOL Revisit the Best Interest Standard in Its Proposed Fiduciary Rule (with Lofchie Comment) (July 24, 2015); SEC Commissioner Gallagher Attacks DOL's Fiduciary Proposal (with Lofchie Comment) (July 22, 2015); SIFMA Opposes DOL's Proposed Retirement Regulation (July 20, 2015); ACLI Criticizes DOL's Proposed Fiduciary Rule (June 30, 2015).