MutualFundWire.com: How Are Fund Firms Reacting to DoL Rule Delay Limbo?

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Tuesday, March 14, 2017

How Are Fund Firms Reacting to DoL Rule Delay Limbo?

Nearly two-thirds of fundsters are reacting in the same way to DoL rule delay limbo. They're waiting.

Jamie Whetzel
USAA
FASG General Counsel

65 percent of fundsters say that their firms are taking a "wait and see" approach to DoL rule implementation in light of the possibility of delay of the impending rule, also called the fiduciary regulation or the Conflict of Interest Rule (COIR). 28 percent say their firms are still going "full speed ahead" with adapting to the impending rule. And 8 percent say they're "changing course" as delay looms.

Those numbers come from a real-time poll of fundsters at a panel discussion this morning at the ICI's Mutual Funds and Investment Management conference at the JW Marriott Desert Springs in Palm Desert, California. That breakout session, "Surviving the Aftershocks: Fund Distribution After the DOL's Seismic Fiduciary Rulemaking," is moderated by ICI counsel Linda French. French polled the audience near the beginning of the session, and attendees used their conference apps to submit their answers.

French's panel includes: Judith Hogan, senior vice president and associate general counsel at MFS; Eric Purple, partner at Stradley Ronon Stevens & Young; Jamie Whetzel, FASG general counsel at USAA; and Rana Jewel Wright, associate general counsel and director at Bank of America Merrill Lynch.

The DoL rule is scheduled to start taking effect on April 10, 2017 (with another stage scheduled for January 1, 2018). Yet the DoL, thanks to an executive memorandum from President Donald Trump, has proposed pushing back that April 10 effective date. And the regulatory agency says they'll even hold off on enforcing the new reg if the delay doesn't take effect until after the April 10 effective date of the reg itself. Yet the IRS and the plaintiff's bar can make no such promises.

Whetzel quips that "there's virtually no limit to what you can blame on the DoL at this point in time."

"It gets you out of pretty much any jam," Whetzel says.

As for fundsters' lawyers, Whetzel says, just respond to others' DoL rule questions by saying "Well, your guess is as good as mine."

Printed from: MFWire.com/story.asp?s=55905

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