The DOL’s final fiduciary rule expands the scope of investment advice subject to ERISA | Global law firm

The DOL’s final fiduciary rule expands the scope of investment advice subject to ERISA | Global law firm

On April 23, 2024, the US Department of Labor (DOL) issued a final rule (the Final Rule) expanding the definition of an “investment advice fiduciary” with respect to employee benefit plans and IRAs for purposes of determining who is a “fiduciary” under the Employee Retirement Income Security Act of 1974, as amended (ERISA). The Final Rule imposes ERISA’s fiduciary protections on many types of investment advisory relationships that were exempted under the DOL’s previous regulatory definition of “investment advice fiduciary,” which has been the standard since 1975. In the DOL’s view, the Final Rule better ensures that retirement investors’ reasonable expectations are honored when they receive advice from financial professionals who hold themselves out as trusted advice providers, by requiring that such advisors adhere to stringent conduct standards and mitigate their conflicts of interest.

Timeline, practical considerations and next steps

The Final Rule is scheduled to become effective on September 23, 2024, along with changes to related prohibited transaction exemptions (PTEs), except for PTE 2020-02 and PTE 84-24, for which there will be an additional one year transition period where exemptive relief will require a written acknowledgement of fiduciary status and compliance with impartial conduct standards. It is widely anticipated that the Final Rule will be subject to litigation challenging its enforceability.

Although the fate of the Final Rule remains unclear, financial institutions and professionals are advised to begin reviewing their current processes and policies and consider what changes are necessary to comply with the Final Rule. In addition, parties that rely on PTE 2020-02 and the QPAM Exemption should review the revised requirements of those exemptions in detail to ensure the relief offered by those PTEs will be available for their businesses, and, if not, consider whether another exemption is available or if an individual exemption needs to be

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“Rule Breaker Investing”: Mental Tips, Tricks & Life Hacks, Vol. 8

“Rule Breaker Investing”: Mental Tips, Tricks & Life Hacks, Vol. 8

In this podcast, we’ve got some life lessons.

To catch full episodes of all The Motley Fool’s free podcasts, check out our podcast center. To get started investing, check out our quick-start guide to investing in stocks. A full transcript follows the video.

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This video was recorded on July 12, 2023.

David Gardner: How can you trick you’re Chief Financial Officer into reallocating capital? What did Ralph Waldo Emerson know about journaling that you should too? And how can you ensure you will create positive memories for grandchildren one day that they will always remember. Have you written a letter to yourself recently or ever? The list goes on. These are not really investment lessons this week this run deeper, they’re life lessons, but often they’re simple, humble. They’re hacks, mental tips, tricks and life hacks volume eight this week only on Rule Breaker Investing.

Welcome back to Rule Breaker Investing a delight to have you joining with me this week. We’re going to have some fun together. Let’s get smarter, shall we? It’s the latest. It’s number 8 in our historical running series of mental tips, tricks and life hacks. The series started with Volume 1 on June 15 of 2016. Now, back then 2016, it was just mental tips and tricks.

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