Opponents of full implementation of the DOL fiduciary rule include the Securities Industry and Financial Markets Association (SIFMA), the Investment Company Institute (ICI), the Financial Services Institute (FSI), the National Association of Insurance and Financial Advisors (NAIFA), the Insured Retirement Institute (IRI), and industry lobbyist Kent Mason of Davis & Harman.
Each opponent of the rule has written the DOL to say the fiduciary rule is harming retirement savers by depriving them of access to advice, reducing their choice of investment products and increasing their costs.
But the CFA’s Roper said there is no proof that any of that is happening. “They fail to provide concrete information that can be tested for accuracy and reliability, making it impossible for the [DOL] to substantiate their claims regarding the rule’s supposedly harmful impact.”
Roper said that while the CFA did not agree with the DOL’s first request for a delay, which the agency said would allow for more efficient implementation, it was at least a “proper purpose for a delay” as laid out in law.
The effective repeal of the DOL rule is based on wholly unproven industry assertions, argues the CFA, that the rule would make it too expensive to offer investment advice to those with accounts under $200,000.
Pershing and Envestnet executives are among strong proponents of the fiduciary rule. “I think there are still pockets of the industry that suspended either their implementation or their belief that this thing [was] actually going to take effect,” said Robert Cirrotti, the managing director of investment and retirement solutions at Pershing, in a letter to the DOL. “I think that really puts them behind the eight ball. On the flip side of that, there are plenty of other firms that are well prepared.”
Envestnet Chairman and CEO Judson T. Bergman, in his own letter to the DOL, contrasted the more “compliance-minded” firms that are adopting new programs to comply with the rule in the IRA market with those firms that are “back to the way it was earlier.”
“Most independent broker-dealers are not rushing to implement any new DOL or fiduciary-compliant programs,” said Bergman, “rather, they are allowing advisors to do business as they’ve always done it.”