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Advisors Must Act in Customers' Best Interest: DOL Secretary

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The U.S. Department of Labor may be postponing implementation of some fiduciary rule compliance rules and procedures, but it still expects retirement advisors to provide impartial advice, and to act in the best interests of the consumers.

R. Alexander Acosta, the Labor secretary, testified Wednesday, at a hearing organized by the House Education and the Workforce Committee, that the DOL fiduciary rule is in effect, that the impartial conduct standards, or best interest standards, took effect June 9, and that the DOL’s Employee Benefits Security Administration has the tools it needs to address material, willful violations of the standards.

“We still have enforcement authority,” Acosta said. 

(Related: DOL Ready to Enforce Fiduciary Rule: Acosta )

The House Education and the Workforce Committee held the hearing to look at OL policies and priorities. The committee has posted materials related to the hearing, including a link to video recording of the hearing, here.

Acosta told the committee that DOL has already drafted regulations describing how DOL would handle violations of the best-interest standards and is putting the draft through a review at the Office of Management and Budget.

Companies would get an extension that would give them at least 18 months to come into full compliance with the remedy requirements, Acosta said.

At the hearing, Acosta also talked about other topics of interest to financial professionals in the employee benefits market, such as efforts to help workers with disabilities and to hold down the cost of health benefits.

Acosta noted that October was National Disability Employment Awareness Month.

This year, the DOL Office of Disability Employment Policy is focusing on apprenticeships, return-to-work programs, support for veterans with disabilities, and helping workers with autism, Acosta said.

About health benefits, Acosta said DOL is working to expand small employers’ access to multi-employer association health plans, to help the employers join together to bargain for cheaper coverage.

—Read DOL May Kill Major Group Disability Claim Regulation on ThinkAdvisor.

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