The DOL Issues Fiduciary Rule FAQ
WASHINGTON, D.C. — Today the DOL issued its first set up FAQs today.
The Department of Labor published an wide-ranging FAQ, based on input received from the financial services industry and others with questions about the new, stricter fiduciary standard to be applied starting next year. The 21-page FAQ addresses general questions and more exacting questions about complex circumstances annuity agents may face.
They address questions like:
- How will the Labor Department approach implementation of the new rule and exemptions during the period when financial institutions and advisers are coming into compliance?
- The full Best Interest Contract Exemption provides that financial institutions cannot “use or rely upon quotas, appraisals, performance or personnel actions, bonuses, contests, special awards, differential compensation or other actions or incentives that are intended or would reasonably be expected to cause Advisers to make recommendations that are not in the Best Interest of the Retirement Investor.” Does this provision categorically preclude financial institutions from paying higher commission rates to advisers based on volume (that is, by using an escalating grid under which the percentage commission paid to the adviser increases at certain thresholds)?
- When do firms and their advisers have to comply with the conditions of the new Best Interest Contract Exemption and Principal Transactions Exemption?
You can read them here…