Preston Rutledge, a high-ranking Senate Finance Committee official, is expected to be appointed to head the Employee Benefits Security Administration, according to news reports.
The Department of Labor agency is responsible for the controversial fiduciary rule. If confirmed, Rutledge will likely be responsible for any changes to the rule.
His title would be assistant secretary of labor, a post previously held by Phyllis Borzi. She is considered the author of the fiduciary rule.
The assistant secretary position reports to Labor Secretary Alexander Acosta and has been vacant since Borzi resigned at the end of January. EBSA oversees 700,000 private-sector retirement plans, and nearly 2.5 million health plans and other welfare benefit plans.
According to his LinkedIn profile, Rutledge is senior tax and benefits counsel for the Senate Finance Committee, a position he's held since February 2011. Prior to that, he was a tax law specialist at the Internal Revenue service for 10 years.
Phase one of the DOL fiduciary rule took effect June 9. It requires advisors and agents to act as fiduciaries, make no misleading statements and accept only “reasonable” compensation.
Phase two of the rule is expected to be delayed until July 1, 2019. A rule finalizing that delay could be published any day in the Federal Register.
Phase two deals with exemptions, which regulate the sale of annuities sold with retirement funds. In particular, the Best Interest Contract Exemption, which requires a financial institution to accept liability for each contract and gives clients the right to sue over investment advice.
The 18-month delay will give the DOL plenty of time to reshape the rule if it chooses.
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].
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