DOL: Soft Launch Kicks In

Author: Jim Fitzpatrick, President, NICSA

Today, the DOL fiduciary rule officially goes into effect – partially!. This ends weeks of speculation as to whether the Department of Labor would again delay its implementation.

While the fiduciary rule itself has not been altered to date, the DOL has issued several transition exemptions in order to ease some of the burden associated with meeting the new requirements. The partial effect focuses on no-conflict behaviors and fiduciary acknowledgments, while full implementation—set to take place on January 1, 2018—will require compliance with the entirety of the regulation, including disclosure provisions.

Today marks the day that many will become newly considered fiduciary advisors and, facing the “soft launch” transition period between now and the end of the year, will have to make “diligent and good faith” efforts to comply with the new standards. Many BDs, RIAs, banks and insurance companies, faced with increased compliance burdens, have begun developing and instituting best practice policies and procedures, including training representatives on how to satisfy fiduciary duties. Many financial institutions have re-evaluated pricing and compensation models and most have developed new share classes.

Many questions remain about the impact of the DOL rule: Will there be a new proposal, an extension, or a modification before the January 1 final implementation date? Will the thousands of new T shares registered with the SEC become effective? Will spending on “regtech” (technology enhancements put in place to comply with regulations) continue to rise?

At our last national NICSA event in February, the DOL fiduciary rule was a central theme and dominated mind share during much of the conference. It was clear that dedication and passion were driving best practice development. As we look toward full implementation on January 1, 2018, asset managers, broker dealers and professional service providers alike are clearly pointed toward improving protection and enhancing efficiencies for investors.

How can NICSA further help our members with the DOL rule transition? Let us know at

NICSA: 8400 Westpark Drive, 2nd Floor McLean, VA 22102 • Tel: 508.485.1500 • Fax: 508.485.1560