While it has not garnered as much attention as some other executive orders, President Trump recently signed an executive order directing the Department of Labor (DoL) to re-evaluate the recently-passed Fiduciary Rule which is due to take effect on April 10. The rule requires anyone who represents themselves as a financial advisor to act in their clients’ best interests. The DoL spent several years drafting the rule and solicited an extraordinary amount of public comment and industry feedback before releasing the final rule last year. Although there is wide industry support for the rule, several insurance industry groups have challenged the rule in various federal courts. The plaintiffs have not won a single case to date, nor have the courts even upheld any of their lesser supporting arguments.
The executive order does not direct the DoL to delay or repeal the law, but either of those outcomes is expected. Information about the law has been removed from the DoL website and some sources claim that the DoL is actively drafting language for a delay. Regardless of whether the rule takes effect or is repealed, rest assured that MFA already operates as a fiduciary to its clients. We put our clients’ interests first and ahead of our own.