Despite the Department of Labor proposing a 60-day delay to its fiduciary rule, “as of today, April 10 is the applicability date,” Dan Kleinman, partner at Morgan Lewis & Bockius in Washington, said Thursday.
That being said, what chance is there that April 10 will not be the compliance date? “I think it’s high 80% to 90% that we will get to that [April 10] date and the rule won’t be applicable,” Kleinman said at the Investment Adviser Association’s annual compliance conference in Washington.
Labor released on Wednesday a proposed rule to extend for 60 days the applicability date of its fiduciary rule under the Employee Retirement Income Security Act.
There have been some “headwinds,” with the administration finding that delaying the rule “was not as easy as originally thought,” but “I was a firm believer that we were always going to get a delay.”
So there’s a “high probability of delay, but we’re just not there yet,” Kleinman added.
Under the plan, Labor will take comments for 15 days on whether the proposed rule should be finalized and will take comments for 45 days on a list of questions about the impact of the fiduciary regulation and the exemptions.
With the Office of Management and Budget announcing that it had finished its review of Labor’s request to delay implementation of its fiduciary rule, “OMB has agreed it should be delayed for 60 days,” Kleinman added.
Hill Pressure on SEC
Richard Roberts, principal at Washington lobbying firm RR&G, stated on another panel discussion at the IAA meeting that there will “continue to be pressure” from Capitol Hill via bills being introduced, statements, as well as hearings for the Securities and Exchange Commission “to fill this [fiduciary] void” once the DOL fiduciary rule is “unwound.”