DOL Rule Delay Sent to OMB

By John Hilton

Update: The Office of Management and Budget posted receipt of the order for regulatory review late Thursday evening.

The Department of Labor has sent paperwork to delay the fiduciary rule to the Office of Management and Budget, sources say.

According to four industry sources, the notice to delay the fiduciary rule’s April 10 applicability date was filed Thursday. A DOL spokesman did not return a message seeking comment.

Fred Reish, lawyer with the firm Drinker Biddle & Reath, tweeted that the request is for a 180-day delay.

The notice to delay must include public notice and public comment steps before it becomes official, said Bruce Ashton, another lawyer with Drinker Biddle & Reath.

One source indicated the request proposes a 15-day comment period.

“Presumably, OMB is going to be urged on by the White House to not tarry,” he said. “There will be maybe like a two-week comment period, so I would expect by mid-March, or maybe late-March there would be this amendment in effect that extends the applicability.”

Extending the applicability date will give the DOL more time to change the rule to its liking, he added. The fiduciary rule extends a best-interest standard of care to anyone investing or doing financial planning with retirement dollars.

Industry opponents say the rule comes with so many added costs that advisors will not be able to servie the small savers who need advice the most.

It has been a busy week for DOL rule opponents. On Friday, it was expected that President Donald J. Trump would announce a rule delay. But White House lawyers scrapped the language just before the president signed the memorandum.

Instead, his memo ordered the DOL to review the rule and decide whether a delay or a counter regulation is needed.

Five days later, Dallas Judge Barbara M.G. Lynn granted a summary judgment to the DOL in an 81-page ruling released just hours after the agency asked for a stay until March 10.

Plaintiffs in the case were led by the U.S. Chamber of Commerce, the American Council of Life Insurers and the Insured Retirement Institute.

Judges in Washington, D.C. and Kansas federal courts previously upheld the fiduciary rule.

InsuranceNewsNet Senior Editor John Hilton has covered business and other beats in more than 20 years of daily journalism. John may be reached at [email protected].

InsuranceNewsNet Senior Editor John Hilton has covered business and other beats in more than 20 years of daily journalism. John may be reached at [email protected]. Follow him on Twitter @INNJohnH.