The Department of Labor’s Employee Benefits Security Administration says it is “disappointed” that industry trade groups could not provide more data by the Feb. 24 deadline to fulfill the department’s request regarding what impact the conflicts of interest faced by brokers and advisors who advise on IRAs have on IRA investors.
EBSA also says it is “bewildered” that the data underlying the Oliver Wyman report stating that applying a fiduciary standard to IRA recommendations is costly will not be “forthcoming” to EBSA to help in its cost/benefit analysis.
An EBSA spokesman told AdvisorOne on Tuesday that while EBSA is “disappointed that more data was not available from the industry sources,” on IRAs, and the groups “have not been able to provide many of the suggested data elements, the department appreciates the information that has been sent, and is working diligently to review and assess it.”
When EBSA released its original rule proposal on fiduciary duty under ERISA in October 2010, EBSA received comments suggesting that it had not adequately demonstrated or quantified the harm that can arise when investment advisors’ interests conflict with those of the IRA owners they advise.
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In response to the comments, EBSA began examining a wide array of evidence and developing a robust economic analysis, and sent out two data requests: one issued on Dec. 16 for the data underlying the Oliver Wyman report; and the second was a request from EBSA’s Office of Policy Research on Dec. 15 that industry trade groups voluntarily assist EBSA in its expanded “regulatory impact analysis” to assess the impact of the department’s reproposed fiduciary rule on ERISA plans and IRAs. That data request was due to EBSA by Feb. 24.
Dale Brown (left), president of the Financial Services Institute, which has been opposed to the DOL’s redefinition of fiduciary, told DOL in a Feb. 24 letter that the assistance FSI is “able to provide is quite limited.”