The financial services industry was in a mad dash to comply with new rules issued last month by the Department of Labor. The U.S., however, has announced that they will be lenient on their enforcement until 2020-2021, at least due time for firms who have already compiled or plan on complying before then so as not to put anyone out there improperly advising clients against retirement accounts under ERISA plans and IRA’s during this period where it is still legal although highly recommended you consult your attorney about these matters if necessary because things could change quickly again tomorrow!
The Fiduciary Rule is a long-saga that has recently been heavily debated. The new Department of Labor regulation, PTE 2020-02, enables an “investment advice fiduciary” to provide rollover or personalized investment strategies without being considered disqualified from doing so by following specific procedures depending on the client’s situation and needs as well as meeting their qualifications for trustworthiness which were established under previous laws before this exemption was created last year.
In 2020, the DOL implemented a new temporary enforcement policy that gave fiduciaries more time to ensure their investment advice was compliant with PTEs. This was after financial services firms expressed concern over not having enough of it beforehand and being limited by what they could do during December’s deadline for this condition set under ERISA law (which effectively means all investors must be given rollover rights).
The temporary enforcement policy will be effective starting today, and it is expected that this new approach to traffic safety fines could generate more revenue for local governments. Under these circumstances, drivers may receive a ticket even if they are not responsible or fully aware of the offense until after receiving their citation.
The Department of Labor has notified that they will not pursue prohibited transaction claims against investment advice fiduciaries from December 21, 2021, through January 31, 2022. This is due to an exemption granted under PTE 2020-02, which exempts these individuals from specific rules while still requiring them to follow other guidelines for their actions to be considered legal. This means there’s no need to worry if you’re working hard at complying with all responsible practices!
Here at DOL, we’re always seeking federal law compliance. In the case of executive provisioning plans (EPP) like PTE 2020-02 through June 30, 2022, there will be some extra scrutiny given to documentation and disclosure requirements as it pertains to rollovers afterward — but rest assured that all other aspects are subjectFull EnForcement beginning February 1, 2022!
Responding to the Department of Labor’s (DOL) issuance of this temporary enforcement policy, financial services firms will now have some breathing space as they evaluate whether or not their operations meet PTE 2020-02’s criteria and implement any necessary conditions.
