Washington (Reuters) – The U.S. Labor Department will delay implementation of its "fiduciary" rule by 60 days while it undertakes a review on whether the rule may hinder Americans' ability to get access to retirement investment advice, according to a filing in the Federal Register.
The department's rule, which requires brokers offering retirement investment advice to act in the best interest of their customers, has been heavily criticized by Republicans and Wall Street amid concerns it may make investment advice too costly.
The delay of the rule, which was slated to take effect April 10, was prompted after President Donald Trump in February ordered the department to conduct the review on whether it should be revised or repealed.
In order to delay the effective date, the department had to undertake a formal rule-making process.
Compliance Deadline Won’t Be Mandated
If the department ultimately decides on a repeal or change, it will need to undertake another rule-making process in the future.
In addition to the 60-day delay, the department also said that other regulatory requirements in the rule for firms to provide disclosures and written representations of compliance to investors will not be mandated until Jan. 1, 2018.
That date, the department added, is when it expects to complete its review.
As of March 17, the department said it had received 15,000 comments in support of a delay, versus 178,000 comments opposing any delay.
Despite the lopsided results, the department said a delay is justified because time is needed to complete the presidentially mandated review.
Rigid adherence to the original April 10 compliance deadline, the department said, could result in "an unduly chaotic transition to the new standards" and lead to "confusion, excessive costs, and needlessly restricted or reduced advisory services."