Newsflash: Has the Fiduciary Worm Turned? Freedom Caucus Targets the New ERISA "Investment Advice" Regulation

December 18, 2016

The U.S. Department of Labor issued its long-awaited and highly controversial "investment advice" regulation under ERISA's fiduciary rules on April 6, 2016. We have issued an OnPoint on the regulation generally, followed by five additional OnPoints on industry-specific or other particular aspects of the regulation1. The regulation is slated to begin becoming applicable in April 2017.

The recent election may have drawn into question the survival of the amended regulation2. Now, on December 14, 2016, the House of Representative's Freedom Caucus issued a key report identifying over 200 legislative and regulatory initiatives targeted by it for elimination during the early days of the Trump administration. This development is potentially critical to the question of whether the amended fiduciary regulation will survive, as one path to its survival is that it flies under the radar long enough to make it to the April applicability date. At that point, the likelihood of ultimate survival is arguably greater. The Freedom Caucus' report indicates, at a minimum, that the regulation does not seem to be flying under the radar.

If there is anything you wish to discuss regarding this topic, please contact the Dechert attorney listed below or any Dechert attorney with whom you regularly work. 


1) See the following Dechert OnPoints:
- The Brave New Fiduciary World Has Arrived – The DOL Tries to Find a More Ideal Balance in the Final “Investment Advice” Rules
- The New DOL Fiduciary Rule: Impact on Mutual Fund Distribution 
- Navigating the DOL’s New Fiduciary Rules: A Game Plan for Broker-Dealers
Mutual Fund Sales by Intermediaries – Fall-Out from DOL Fiduciary Rule and  FINRA Enforcement 
- The DOL Issues “Investment Advice” FAQs – Continues to Try to Find an Ideal Balance for the Brave New Fiduciary World
- DOL “Investment Advice” FAQs: Considerations for Investment Advisers, Broker-Dealers and Insurance Companies 
2) For additional commentary by Dechert attorneys regarding the potential cloud around the continued viability of the new rule, see: InvestmentNews, The Wall Street Journal, Bloomberg BNA, HR Magazine

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