New Report Estimates DOL's Fiduciary Rule Will Cost Firms $3.9 Billion

The Financial Services Institute ("FSI") issued a report estimating the costs of the DOL's proposed fiduciary rule. The FSI commissioned Oxford Economics, an independent global advisory firm, to review the impact of the proposed DOL rule amending the definition of "fiduciary" for retirement accounts. Titled: "Economic Consequences of the US Department of Labor's Proposed New Fiduciary Standard," the report estimates that the proposed rule will cost the financial services industry close to $3.9 billion in total startup costs – nearly 20 times the cost estimated by the DOL. It also suggests that, if implemented, only high net-worth investors will be able to access and afford professional retirement investment advice.

The report also predicts that industry consolidation could force small broker-dealers out of business and result in less access to advisors for small and medium-sized investors.