By Arthur D. Postal
WASHINGTON – The Labor Department has refused a request by 16 trade associations to lengthen the 75-day comment period for the agency’s proposal to revise its fiduciary standard.
Labor Secretary Thomas E. Perez reiterated DOL’s previously stated comment guidelines last week, saying it was more than adequate.
The comment period is 75 days, followed by a public hearing and publication of the transcript followed by another comment period. This follows 18 months of “informal outreach” to get the opinions of all the stakeholders, Perez said.
The DOL published the rule for comment April 20, when it appeared in the Federal Register. The comment period ends July 6.
The trade groups say a 120-day comment period is needed. A letter they sent said that the 75-day comment period is inadequate to address the “far-reaching modifications that will be required to meet the conditions to the exemptive relief that DOL perceives as important” to protect the interests of retirement investors.
The letter added that, “a 120-day comment period would lead to more thoughtful and comprehensive input, which will ultimately increase the possibility for a more workable final rule that would benefit all parties.”
The letter argued that, the current fiduciary proposal contains detailed new rules that will “increase the legal risks financial professionals face when providing financial education and guidance to clients.”
It said, “The associations urge regulators to allow sufficient time for careful analysis and consideration of the proposal by financial institutions and stakeholders, as well as allow regulators time to make well-informed decisions about the proposal based on industry and public feedback.”
The letter was signed by an official of the Financial Services Roundtable. Other signees included the American Council of Life Insurers, American Retirement Association, Association for Advanced Life Underwriting, the Financial Services Institute, Insured Retirement Institute, National Association for Fixed Income Annuities and the National Association of Insurance and Financial Advisors. The U.S. Chamber of Commerce also signed the letter.
Barbara N. Roper, director of investor protection for the Consumer Federation of America, defended the Labor Department decision.
She said that the 75-day comment period (to be followed by a public hearing and additional opportunity for comment) “is more than sufficient to allow for a careful and thorough review.”
She added that, “If these industry groups would put half the resources into analyzing the rule that they’ve put into opposing it sight unseen, they could finish their comments with plenty of time to enjoy a relaxing July 4th weekend.”
InsuranceNewsNet Washington Bureau Chief Arthur D. Postal has covered regulatory and legislative issues for more than 30 years. He can be reached at [email protected].
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