New Department of Labor Retirement Advice Rule is Weakened

Posted on April 14th, 2016 at 5:06 PM
New Department of Labor Retirement Advice Rule is Weakened

From the Desk of Jim Eccleston at Eccleston Law LLC:

The rule to set a fiduciary standard for financial advisors who sell retirement products has been the subject of contentious debate and recently was weakened due to pressure from the financial services industry.

The initial proposal involved a number of restrictions intended to reduce a broker’s conflict of interest. The final rule, unlike the initial proposal, does not restrict brokers from selling proprietary products, splitting revenue with funds, or recommending risky, high-fee investments in alternative assets and certain annuities. Additionally, the implementation of the new rule has been delayed until January 1, 2018.

The DOL also has created the “Best Interest Contract Exemption” (BICE), which allows fiduciary advisers to continue certain compensation fee practices, as long as they commit to acting in the best interest of the client and satisfy additional conditions set by the DOL, intended to mitigate conflicts of interest. Similarly, the “Principal Transaction Exemption” increases existing exempted relief to enable a fiduciary investment advisor to sell/purchase debt securities to/from their plan of IRA clients, provided that they follow DOL rules to mitigate conflict of interests and to act in the best interest of the client. 

The attorneys of Eccleston Law LLC represent investors and advisers nationwide in securities and employment matters. Our attorneys draw on a combined experience of nearly 65 years in delivering the highest quality legal services. If you are in need of legal services, contact us to schedule a one-on-one consultation today.

Related Attorneys: James J. Eccleston

Tags: Eccleston, Eccleston Law, Eccleston Law LLC, James Eccleston,

Return to Archive



As a financial advisor with over 20 years of experience, I feel fortunate to call Jim my attorney and friend. He is a fantastic lawyer and trusted advisor. He is skilled in the matters necessary to do the job well. He uses his thoughtful approach and calm demeanor to achieve a positive outcome for the client. If you want to feel confident that nothing will be missed and that you will be represented in a highly professional manner, call Jim Eccleston.

Bill C. and Dan M.


October 26, 2021
Former Advisor Fails To Reverse Bar After Alleged $1 Million Theft From RBC

A former RBC Wealth Management advisor lost his bid to reverse an industry bar, according to an appellate decision issued by the Financial Industry Regulatory Authority (FINRA).

October 25, 2021
Firms Walk Thin Regulatory Line In Referring Self-Directed Clients To Advisors

While online trading platforms have surged in popularity during the pandemic, brokerage firms view self-directed investors as a source of new clients.

October 22, 2021
TIAA Sues Former Advisors For Allegedly Soliciting Clients

Teachers Insurance and Annuity Association of America (TIAA) filed suit against three of its former Connecticut advisors for allegedly soliciting TIAA clients to join them at their new firm.