RIA Compliance and Practice Management Blog

Top RIA Compliance News Articles for the Week of April 1, 2017

Posted by RIA in a Box

Apr 7, 2017 1:46:47 PM

DOL rule officially delayed until June 9, 2017 and future of Dodd-Frank

Each week we’re giving you our weekly report highlighting the top compliance news articles from various industry news publications. We have selected the most relevant and important news articles related to registered investment adviser ("RIA") compliance and regulatory issues. This week's recap focuses on the offical delay of the Department of Labor ("DOL") fiduciary rule and the future of Dodd-Frank. Check back each week for the latest list of top stories.

Here's our top investment adviser compliance articles for the week of April 1, 2017:

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  1. 'Poof it's Gone!' DOL Quietly Strips Two Heavy Lifts From the Fiduciary Rule As it Makes Delay Official (Author- Brooke Southall, RIABiz)

RIABiz's Brooke Southall reports, "in making official its 60-day delay until June 9, the DOL eliminated its two most stringent requirements--namely the need to declare fiduciary status to its clients and the associated need to disclose specific conflicts of interest." CEO of the Pension Resource Institute, LLC., Jason Roberts, says "poof, it's gone" and "it was a major shift." Roberts currently suggests RIA clients to abide by the rules only as far as the law requires. As discussed in our recent blog post, as of now, adherence to the Impartial Conduct Standards is the only requirement scheduled to now become applicable as of June 9, 2017.

  1. DOL Announces 60-Day Delay to Fiduciary Rule and Exemptions and Makes Significant Changes to Transition Period Compliance (Author- The Wagner Law Group)

In similar coverage, the Wagner Law Group informs that on April 4, 2017, the DOL officially proposed a 60-day delay to the new fiduciary rule. The date is extended from April 10 to June 9, 2017. The new and amended exemptions, such as the Best Interest Contract Exemption ("BICE"), are delayed until this date as well. The Wagner Law Group update provides detailed information regarding when firms must comply with which exemptions in reference to the transition period between the new applicability date (June 9, 2017) and January 1, 2018.

  1. Empty Seats at Regulators Hold Back Trump Bid to Undo Dodd-Frank (Author- Robert Schmidt & Ben Bain, Financial Advisor)

The U.S. Securities and Exchange Commission ("SEC") and Commodity Futures Trading Commission ("CFTC") currently a number of open seats that need to be filled. Financial Advisor's Robert Schmidt and Ben Bain report that due to these missing seats, "republicans and President Donald Trump have made little progress on Capitol Hill trying to repeal the 2010 Dodd-Frank Act, the post-crisis law that loaded new rules on Wall Street." Schmidt and Bain's article looks into Trump's plans to roll back Wall Street regulations and how the lack of filling these empty agency seats is causing the delay.

  1. 3 Steps to Offering Fiduciary-Friendly Rollover Advice (Author- Matt Sommer, Think Advisor)

The Investment Company Institute recently released a paper, "The Role of IRAs in U.S. Households' Saving for Retirement, 2016." It elaborates on the importance of the IRA rollover opportunity for advisors regardless of the DOL Conflict of Interest Rule. It provides statistics for the number of individuals who consult financial advisors concerning their rollover. Matt Sommer, Vice President and Director of the Retirement Strategy Group at Janus Capital, reveals steps advisors can take to make the most of the rollover opportunity. The three steps include: "refining your value proposition, preparing to answer tough questions and putting the clients' interests first." Sommer goes into more detail on these steps in this ThinkAdvisor article.

  1. OCIE Chief: Compliance Staffs Should Treat Independent RIAs Like Company RIAs (Author- Ted Knutson, LinkedIn)

Financial Advisor Magazine reporter, Ted Knutson, published this LinkedIn article discussing how Peter Driscoll, Acting Director for the SEC Office of Compliance Inspections and Examinations ("OCIE"), believes a firm's compliance staff should treat individual representatives that are not technically firm employees, but instead independent contractors, with the same vigilance as all individual representatives. Driscoll notes that he is "worried they (RIA firms) aren’t being tough enough because firms are cautious about being stringent on compliance with independents out of fear they could jump ship and go to a more lenient competitor." He also provides insight on Driscoll's opinion of advisor exams, robo advisors, and cybersecurity. Driscoll voiced these opinions at IA Watch's annual compliance conference held in Washington, DC this week.

How an RIA Firm Can Create a Culture of Compliance Checklist

Don't forget to check out last week's top RIA compliance news articles on the DOL fiduciary rule, breakaway broker considerations, and senior protection. Be sure to check back next Friday for next week’s top articles! 

Lexington Compliance and RIA in a Box LLC are not law firms, investment advisory firms, or CPA firms. Lexington Compliance and RIA in a Box LLC do not provide legal advice or opinions to any party or client. You should always consult your relevant regulatory authorities or legal counsel if applicable.

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