Federal regulations that would expand who is considered a fiduciary may find new life.

U.S. Department of Labor regulations that would extend the fiduciary standard to a larger group of people advising on retirement plans are on hold for now, but they may not be dead, according to those who are following the fate of the proposals.

DOL had proposed extending the fiduciary standard so that broker-dealers and their representatives would be forced to meet its more stringent requirements. The rules were written and it had been said a decision would be made before the end of this year.

But vehement objections from some broker-dealers have put the new ideas on hold for now.

DOL received objections from some who questioned the need for the new regulations and the cost of implementing them. Some terms in the proposal were not defined well enough, making adherence difficult,  experts said.

Broker-dealer representatives have cited high administrative costs for ensuring compliance to fiduciary standards. Representatives now meet a suitability standard to show that advice given to employers for retirement plans or plan participants is suitable for their needs. Fiduciary standards are much stricter, and require advisors to work in a client's best interests.

Broker-dealer reps have complained they will be forced to not advise on retirement accounts if they have to meet fiduciary standards. They will have to develop a new business model to meet fiduciary standards or drop the business, said Bradford Campbell, with the law firm Drinker Biddle in Washington D.C. Campbell is former head of the Employee Benefits Security Administration, which oversees these types of regulations within the Department of Labor

"There was bipartisan opposition to the proposed regulations," said Campbell. If broker-dealer representatives cannot sell their own products to retirement plan sponsors, they may not be able to do business as they currently do and they would not receive commissions, he said.

Some broker-dealers would not let their representatives work with plans if they could not sell products to them, said Adam C. Pozek, a partner at DWC Erisa Consultants LLC in Boston.

The SEC is considering similar changes that would require brokers to be held to fiduciary standards in some cases. Both sets of regulation changes are on hold and there is general agreement that they will not be dealt with until after the November elections.

While it is important to provide those protections as quickly as possible, it is also important to take the time needed to get it right, according to the Department of Labor. No action is expected before the end of the year.

"Conventional wisdom has it that the fate of the DOL rule may depend on the outcome of the election," Pozek said. Republicans tend to favor fewer regulations and if successful in November, the rule may die a natural death. However, if President Obama is re-elected, the rule may be revisited.

Campbell, on the other hand, feels the Department of Labor is committed to enacting the regulation in some form, although it will be reworked.

-Karen DeMasters