NAFA ALERT

DOL's newest proposed fiduciary rule package now available in the Federal Register

Today, the Department of Labor’s new proposed fiduciary rule was published in the Federal Register. This rule package includes proposed amendments to a number of existing prohibited transaction exemptions, along with a proposed new fiduciary rule that would expand fiduciary obligations on independent insurance producers when recommending 401(k) and IRA rollovers. The three primary components of this regulatory package that most affect NAFA member interest include a Proposed Amendment to PTE 84-24, a Proposed Amendment to PTE 2020-02, and the Retirement Security Rule - Definition of an Investment Advice Fiduciary.

Publication in the Federal Register opens up the public comment period, which at present is 60 days, making written comments due on or before Jan. 2, 2024. Additionally, the Department will hold a public hearing in approximately 45 days following today’s publication, setting that date for Monday, Dec. 18.

NAFA, as part of a broad coalition of industry trade organizations, will be sending a letter to the Department next week requesting addition time for the comment period, to have the public hearing held after the close of the initial comment period, and to open a second public comment period to allow stakeholders and interested parties to provide comment on issues addressed during the public hearing. With several federally recognized holidays between now and Jan. 2, 2024, there are only 39 business days to provide commentary on this important and sweeping regulation given the current timeline. There is precedence for a more reasonable timeline with past fiduciary rule iterations, and we believe that the Department will grant some accommodation to allow for meaningful public engagement.

As we communicated in the NAFA member alert sent earlier this week, NAFA continues to review and analyze the details of the proposed new fiduciary rule and its impact on industry and will be providing a more in-depth summary to membership in the next several days.

The Department’s latest ill-conceived attempt to expand its jurisdiction over rollover recommendations demonstrates, once again, its lack of understanding of the benefit of insured retirement solutions in providing retirement security for millions of Americans. The initiative also runs contrary to the fact that Congress passed, and the Administration recently signed, legislation to give Americans more access to annuities. If the Department succeeds in implementing its misguided new fiduciary regulation, the retirement crisis will be exacerbated, causing irreparable harm to low-and middle-income savers who need the products and professional advice our industry provides. NAFA will exhaust all resources to protect the future of fixed annuities and the critical value they provide to everyday Americans.

At present, we ask you to mark your calendars for two scheduled webinars: The Newest Fiduciary Rule: An Expert Analysis, which will be held on Tuesday, Nov. 14 at 2:00 p.m. CT featuring a NAFA premier partner panel, and The DOL Proposal's Potential Impacts on the Fixed Annuity Community on Wednesday, Nov. 29 featuring DC legal experts from Groom Law. Please watch your inbox for notifications and registration for these webinars, as well as other communications related to this evolving issue.