Fifth Circuit Vacates DOL Fiduciary Rule
In a 2-1 decision, the US Court of Appeals for the Fifth Circuit struck down the US Department of Labor’s (“DOL”) fiduciary rule, deciding in favor of a number of leading financial services industry trade associations. The court found that the DOL unlawfully expanded the definition of the term “fiduciary” to be overly broad and inconsistent which included commissioned brokers. The court ultimately agreed with these leading financial services associations which argued that the Rule would cause many financial service providers to exit the market for retirement advice, thereby hurting the people that the DOL intends to protect.
Assuming there are no challenges to the decision, the court’s ruling will become effective on May 7th. Foreside will continue to stay abreast of this topic and will disseminate any information to our clients as it becomes available.