Barring any further unforeseen circumstance, the fiduciary investment advice rules, which were to take effect on April 10, 2017, will now take effect on June 9, 2017, according to a news release from the Department of Labor’s Employee Benefit Security Administration (EBSA). In conjunction with the news release, EBSA issued a set of FAQs and Field Assistance Bulletin 2017-02. For background relating to the investment advice rules, see the May and December 2016 editions of our At Issue newsletters; also see our Benefit Beat implementation date coverage this year from the April 10th , March 3rd, and February 15th editions.
Of particular note, for the near term, as long as fiduciaries act in good faith toward compliance with the rules, the Department of Labor will not take action against them, as explained in Q1 in the above-referenced FAQs, and in the Field Assistance Bulletin. This means that fiduciaries must act in an impartial way, i.e., any advisement rendered by the fiduciary must be in the best interest of the investor, the fiduciary must take no more than reasonable compensation for such advice, and the fiduciary must avoid making materially misleading statements.
Certain aspects of these rules are still scheduled to take effect in January, 2018, most notably, the provisions relating to best interest contracts.
The information contained in this article is provided as general guidance and may be affected by changes in law or regulation. This article is not intended to replace or substitute for accounting or other professional advice. Please consult a CBIZ professional. This information is provided as-is with no warranties of any kind. CBIZ shall not be liable for any damages whatsoever in connection with its use and assumes no obligation to inform the reader of any changes in laws or other factors that could affect the information contained herein.