Monday, September 19, 2011

Department of Labor Withdraws Rule, Will Repropose

Citing a desire to "protect consumers" and "avoid unjustified costs and burdens," the Department of Labor announced today that it will withdraw its current fiducuiary rule and re-propose a new rule early in 2012.

That is good news for small-savers. Now it will be important for the Department to protect small IRA holders in its plans going forward.

The DOL's press release hinted that it understands the IRA problem (excerpt below), but as always, the devil is in the details.

Also anticipated are exemptions addressing concerns about the impact of the new regulation on the current fee practices of brokers and advisers, and clarifying the continued applicability of exemptions that have long been in existence that allow brokers to receive commissions in connection with mutual funds, stocks and insurance products. The agency will carefully craft new or amended exemptions that can best preserve beneficial fee practices, while at the same time protecting plan participants and individual retirement account owners from abusive practices and conflicted advice.
Read more here.