DOL Starts Clarifying Fiduciary Rule With Exemption FAQs, But Not Force Of Law

By Ted Knutson

The Department of Labor started issuing compliance clarifications for the fiduciary rule Thursday with the publication of Best Interest Contract and Principal Transactions Exemption Frequently Asked Questions (FAQs): http://bit.ly/2dMctqQ

“(These) will head off misunderstandings that could lead to bad results for retirement savers, or financial services professionals,” DOL Employee Benefits Security Administration chief Phyllis Borzi said in an accompanying blog.

However, they do not have the force of law, said noted private retirement regulatory attorney Fred Reish.

“FAQs are statements of the DOL’s position or interpretation of the rules, but they are not, in and of themselves, the “law,” said Reish in an email.

The 24 pages of FAQs give guidance on 34 fiduciary rule questions related to deadlines, specific compliance requirements of the BIC exemption, compensation allowed under BIC and exemption issues with intermediaries.

This is one of the rare times in Washington that when a government official has said soon, soon happened. Borzi made the promise Tuesday.

Before the end of the year, DOL will also release FAQs on conflict of interest rule definitions and miscellaneous exemption issues, she said.