The U.S. Department of Labor (DOL) has unveiled its regulatory agenda which appears to include introducing a new fiduciary rule. Notably, the decision made by the Florida Federal District Court, which vacated the DOL’s attempted re-interpretation of its fiduciary role, has not been appealed by the DOL. The re-interpretation involved an argument that ongoing investment advice to a rollover Individual Retirement Account (IRA) could be linked to the rollover recommendation to a participant, therefore satisfying the “regular basis” prong of the five-part fiduciary test. This was a significant departure from prior DOL interpretations.
For context, the DOL had stipulated in the past that unless a person was already a fiduciary to a plan, a recommendation to a participant to execute a plan would not establish the person as a fiduciary. The proposed new fiduciary rule and its potential impacts are worthy of close scrutiny by legal professionals, particularly those specializing in labor and employment law or serving corporations with large retirement plans.
More details on this topic can be found on the following legal news site: JDSupra. The article, authored by Faegre Drinker Biddle & Reath LLP, presents a broader perspective on these developments as well as examining the potential future repercussions of the regulatory agenda.