Investment Professionals

Response to Department of Labor’s Request for Information Regarding Reexamination of Conflict of Interest Rule

Since the DOL fiduciary rule and Prohibited Transaction Exemptions (PTEs) were finalized, however, firms have developed a variety of innovative, pro-investor approaches to implementing the rule and new investment products to ease that implementation. As a result, retirement savers are benefiting from broad access to both fee-based and commission advisory relationships, with fewer conflicts and lower costs, and with a wide array of investment products available to meet their needs and goals. Contrary to the dire predictions of the rule’s opponents, these developments clearly show that the existing rule and PTEs are not only workable, but working far better than the Department or the rule’s proponents could have predicted when the rule was finalized.

In light of these positive developments, it is premature to consider sweeping changes to the rule and its exemptions just as they are beginning to deliver the dramatic, tangible benefits that proponents of the rule have long predicted. Instead, we urge the Department to focus on providing additional guidance, based on the positive examples already available in the marketplace, for how the rule can be implemented efficiently and effectively under the existing PTEs. Such an approach would reward the firms that have moved forward in good faith to develop innovative implementation plans and consumer-friendly investment products while providing those that have fallen behind in their implementation plans with greater clarity regarding the variety of acceptable options they have for coming into compliance with the rule.

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