DOL to Hold Hearing March 1 on Fiduciary Proposal, Webcasts on Jan. 4

Borzi said in a Oct. 21, 2010, speech that fiduciary status is fundamental to ERISA’s framework for protecting the interests of plan participants and the statute contains a broad functional test for determining who is a fiduciary” when providing investment advice. While ERISA is “very simple and straightforward” about who’s a fiduciary in stating that it’s “someone who renders investment advice for a fee or other compensation, direct or indirect, with respect to any monies or other properties of the plan,” a 1975 regulation issued by DOL and certain interpretations since then have taken “a much narrower approach” to defining fiduciary, Borzi continued.

The current rule regarding fiduciary, Borzi said, “simply is not working.” The “dramatic evolution in the marketplace” coupled with “the enforcement activities that the DOL has undertaken both in our investigations and our litigation over the past three decades have made it perfectly clear that these arcane rules really interfere with the ability of the Department and fiduciaries to understand where the lines are being drawn, and to protect beneficiaries and participants.”

Officials at seven of the DOL’s agencies will host live Web chats to discuss their respective regulatory agendas during the first week of January 2011. EBSA will hold its web chat from 2:00 to 3:00 pm EST on Tuesday, Jan. 4. To participate in the Web chats, visit https://www.dol.gov/regulations/.