The first phase of the Department of Labor’s new fiduciary rule goes into effect on June 9, with full implementation slated for Jan. 1. While the DOL is soliciting public comment on the rule and has declared it won’t be enforcing the rule for the remainder of the year (including any IRS tax penalties in case of violation), the department’s stated expectation is that advisors should be “working diligently and in good faith to comply with the rule.”
In fact, many industry experts say while the current scrutiny of the rule may lead to a relaxation of certain elements, such as client disclosure requirements, the spirit of the rule will likely endure. Indeed, investor preferences for transparency, objectivity and lower-cost investments will continue to shape the industry.
What does this mean and what should advisors be doing now? Here are seven ideas to consider that may help strengthen your business and reduce your exposure to risk as the new regulations get fully implemented.
Joshua Pace is the CEO of the Trust Company of America.
