The Department of Labor’s fiduciary rule will be applied on June 9, but lightly and with a review before the full application of the rule on Jan. 1.
Although headlines from Labor Secretary Alexander Acosta’s Wall Street Journal column focused on the fact the rule would go into effect on June 9, the text of his op-ed article emphasized President Donald Trump’s directive to “roll back unnecessary regulations that eliminate jobs, inhibit job creation, or impose costs that exceed their benefits.”
Acosta added that the rule might run afoul of that directive.
“Although courts have upheld this rule as consistent with Congress’s delegated authority, the Fiduciary Rule as written may not align with President Trump’s deregulatory goals,” Acosta wrote. “This administration presumes that Americans can be trusted to decide for themselves what is best for them.”
He said the DOL would examine the rule while observing two principles: respect for the individual and respect for the rule of law. The department could find no way under the law to postpone the first step of the rule on June 9, despite an email from a Senate staffer who said Acosta was looking for a way to impose an additional delay.
In his op-ed, Acosta said the DOL will be looking for more public comment on the rule with an eye toward any action on it before its full implementation on Jan. 1.
“The Labor Department has concluded that it is necessary to seek additional public input on the entire Fiduciary Rule, and we will do so,” he wrote.
The DOL issued a bulletin on Monday saying the department will not be enforcing the rule for the rest of this year. That includes the tax penalty the Internal Revenue Service would impose in case of a violation.
“Accordingly, during the phased implementation period ending on January 1, 2018, the Department will not pursue claims against fiduciaries who are working diligently and in good faith to comply with the fiduciary duty rule and exemptions, or treat those fiduciaries as being in violation of the fiduciary duty rule and exemptions.”
Steven A. Morelli is editor-in-chief for InsuranceNewsNet. He has more than 25 years of experience as a reporter and editor for newspapers, magazines and insurance periodicals. He was also vice president of communications for an insurance agents’ association. Steve can be reached at [email protected]
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