Nearly 10 years in the making, the effort to heighten the advice standard for brokers was solidified on June 5 when the Securities and Exchange Commission passed Regulation Best Interest.
Phyllis Borzi, former head of the Labor Department’s Employee Benefits Security Administration, launched Labor’s bid to require that broker-dealers adhere to a fiduciary standard when advising retirement accounts in 2010. Former Labor Secretary Tom Perez took up the fiduciary mantle and helped Borzi push Labor’s rule to the finish line in April 2016, only to see it vacated by a U.S. appeals court in June 2018.
Current Labor Secretary Alexander Acosta confirmed to lawmakers in May that Labor would indeed issue new fiduciary-related rules this year. Industry officials anticipate those rules by fall.