Top RIA Compliance News Articles for the Week of July 15, 2017

1. DOL Fiduciary Rule: Transfers of IRAs in the New Fiduciary World (Author- Fred Reish, Investment News)

Fred Reish, one of our top 5 DOL fiduciary rule experts to follow, brings us this Investment News article where he focuses on the recommendation to transfer an IRA from another firm to the adviser’s firm. “Advisers to plans, participants and individual retirement accounts are now fiduciaries under the Department of Labor’s (“DOL”) new regulation and prohibited transaction exemptions,” Reish begins. Requirements for what will be seen as fiduciary advice have been thoroughly discussed but little has been said on the topic of IRA transfers. He discusses the IRA transfer scenario in detail as well as the importance of documenting and having processes in place.

2. Anti-DOL Fiduciary Rule Bill Passes House Panel (Author- Kenneth Corbin, Financial Planning)

On Wednesday, two House committees moved to advance proposals to block or overturn the DOL fiduciary rule. Kenneth Corbin of Financial Planning reports, “The House Committee on Education and the Workforce approved a bill that would erase the DOL rule, replacing it with a statutory obligation for advisers to make recommendations in their clients’ best interests, but relying more heavily on disclosure to mitigate conflicts of interest.” The Appropriations Committee approved a funding bill blocking the department from enforcing the fiduciary rule as well. Corbin also reports the incoming DOL and Securities and Exchange Commission (“SEC”) heads have both reportedly pledged to “resume interagency collaboration on fiduciary issues.”

3. Second Time the Charm For Conservative SEC Commission Nominee? (Author- Ted Knutson, Financial Advisor)

Hester Peirce, a researcher at the Mercatus Center at George Mason University, has been nominated to serve as an SEC commissioner for the second time. Financial Advisor’s Ted Knutson reports Peirce has been “a prominent critic of the Dodd-Frank financial reform act.” She also has been a member of the SEC’s Investor Advisory Committee and was an attorney on Alabama Sen. Richard Shelby’s Banking committee staff while Dodd-Frank was being developed.

4. Tech Planning Timeline for Your Breakaway RIA (Author- Wes Stillman, ThinkAdvisor)

CEO of RightSize Solutions, Wes Stillman, provides insight on how to evaluate technology systems when an advisor decides to breakaway and start their own RIA firm. He reveals three phases of what is called the “breakaway cycle”. These phases include: 12 months from launch date: research & guidance, six months to go: building a virtual office, and the open for business: reality check. Stillman advises, “breakaways should not make the mistake of choosing cheaper technology initially, intending to upgrade and patchwork in better solutions down the road.”

5. Fiduciary Rule Request for Information Deadline Friday (Author- Cyril Tuohy, Insurance News Net)

Industry reporter Cyril Tuohy shares, “agents, financial advisors and other representatives of the financial services industry have until 11:59 p.m. Friday to comment on delaying implementation of provisions of the Department of Labor’s fiduciary rule.” He provides details of where comments can be submitted in his article. Tuohy claims as of Thursday afternoon, more than 40 comments have already been received. Industry experts believe the chance is highly likely the second phase of the DOL fiduciary rule could be further delayed. A separate comment period pertaining to exemptions is open until 11:59 p.m. August 7. 

Don’t forget to check out last week’s top RIA compliance news articles on the DOL fiduciary rule and the potential of a uniform fiduciary rule. Be sure to check back next Friday for next week’s top articles!