Day after DOL delay, SEC's Jay Clayton calls a fiduciary rule a priority

Chairman says it's important that the SEC be involved in coming up with a fiduciary standard that will make investors happy

Nov 28, 2017 @ 2:23 pm

By Bruce Kelly

In light of the Department of Labor's decision Monday to delay the full implementation of the fiduciary rule for retirement accounts, the Securities and Exchange Commission will make a fiduciary standard for brokers a priority, according to SEC Chairman Jay Clayton.

"I think I've been clear, we are working on a fiduciary rule and exploring it for brokers and investment advisers," said Mr. Clayton Tuesday morning on the sidelines of the Managed Funds Association meeting in New York. "It's a priority for me to address this space in light of the action that the Department of Labor took to step into this space."

"I think we belong in this space," he said. "And we should try and produce a rule, that, when investors see it, they are happy with."

Mr. Clayton's comments come the day after the DOL released a final rule that would delay implementation of its enforcement mechanism until the middle of 2019.

The rule would postpone from Jan. 1, 2018, to July 1, 2019, the applicability of a legally binding contract between brokers and retirement-account clients that requires brokers to act in their best interests, among other disclosure provisions and prohibited-transaction exemptions being pushed back.

The DOL said it needs the extra time to conduct a reassessment of the rule's impact on retirement advice that was ordered by President Donald J. Trump in a Feb. 3 memo. Two provisions of the rule — one that expands the number of financial advisers who are deemed fiduciaries and another that sets impartial conduct standards — were implemented in June.

Critics of the DOL's delay on Monday said it spelled death for the regulation. Supporters of the delay said it gives the DOL time to conduct a thorough review of the rule.

The DOL also said it needs the next year-and-a-half not only to conclude its review of the rule but also to coordinate with the SEC as well as state insurance regulators on setting investment advice standards.

Senior reporter Mark Schoeff Jr. contributed to this story.

0
Comments

What do you think?

View comments

Recommended for you

Featured video

Events

The importance of a diverse team

Clients, advisers, and even communities are telling firms that yes, diversity within the advisory community is important.

Latest news & opinion

Joe Duran has a game plan, and anyone can play

The CEO of United Capital built a formula for holistic financial planning that any firm can tap into — for a price.

LPL video about private equity looks like a swipe at Cetera

Recruiting video warns about potential consequences for advisers when a PE firm buys a broker-dealer.

Ladenburg chairman Phillip Frost steps down

The SEC charged Frost with fraud earlier this month.

Envestnet Tamarac partners with Schwab, TD on digital account openings

Auto-filling documents designed to make onboarding more efficient for RIAs and more convenient for clients.

Wells Fargo plans to cut staff up to 10% within next three years

Bank is struggling to cut spending amid regulatory fines and higher legal costs stemming from scandals.

X

Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting investmentnews.com? It'll help us continue to serve you.

Yes, show me how to whitelist investmentnews.com

Ad blocker detected. Please whitelist us or give premium a try.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print