Delay / Repeal of Fiduciary Rule Expected

[austin3515]

Imagine how quickly people will act the next time sweeping regulatory changes are proposed.  I feel bad that a lot of MAJOR corporate decisions were made based on this rule. You had companies simply withdrawing from this industry and selling whole divisions in anticipation.  So they're going to be penalized for getting ahead of the curve. 

https://www.insurancenewsnet.com/innarticle/1154689

[My 2 cents]

Who will protect the unsophisticated, essentially innumerate 401(k) participants with little or no understanding of economics (who have little hope of a decent lifestyle after they can no longer work outside of their 401(k) plan)?  Don't they deserve to have their accounts invested in ways that are solely for their benefit and not for the benefit of overpaid financial advisors?  Feel sorry for them and not for those who felt that they could not remain in the business unless they could take advantage of the rank and file participants.  Too many investment firms seems to be operating under a mission statement something like "a fool and his money are soon parted, and who better to benefit from that than us?"

[MoJo]

Lots of talk - I'll believe it when I see it.  In the case of the company I work for, it's full steam ahead to comply REGARDLESS of whether the rule is repealed, delayed, modified, or any combination of the foregoing.  It is perceived as "the right thing to do" and is expected to be a competitive advantage in the marketplace against those who do otherwise.

[RatherBeGolfing]

I doubt it will be repealed, but it will probably be delayed and modified.  There is nothing earth shattering about that.  If memory serves me right, GWB's DOL had a a fiduciary rule all but ready when O's DOL scrapped it and started over.  

I expect some changes, but this is the way the industry has been trending anyway.  There are some sections of the rule that I'm sure some will be thrilled to do away with though.

 

[austin3515]

My 2 cents, I completely agree that there are scoundrels out there, and getting rid of this would be too bad.  So there are multiple losers, so let's say its at least a tie for the unsuspecting participant whose going to be sold a piece of garbage annuity, and the firms that spent millions and millions to comply for nothing. 

[MoJo]

14 minutes ago, austin3515 said:

... so let's say its at least a tie for the unsuspecting participant whose going to be sold a piece of garbage annuity, and the firms that spent millions and millions to comply for nothing. 

Sorry, but I disagree.  The money spent in configuring a compliance mechanism is money that needed to be spent.  If the industry had self-policed, the burden wouldn't have been so great, and would have been incremental over time instead of all at once - but it is money that needed to be spent.

The White House report pegged the losses to participants at $17 BILLION, ANNUALLY.  The costs are a pittance - even if halve or even quarter that number.

[austin3515]

Well, I do think a bad precedent was set here.  I'll just leave it at that.

[TPAJake]

From Forbes.com, can it be true?!

President Trump has signed an executive order instructing the Labor Department to re-consider the controversial ruling passed in the middle of 2016 imposing a sort of “qualified fiduciary rule” on retirement accounts only, the so-called “DOL Ruling.”