SIFMA Warns of Investor Harm if DOL Moves Forward with Fiduciary Rule Unchanged

Washington, D.C., September 15, 2017 – In a comment letter filed today with the Department of Labor, SIFMA expresses its support for the DOL’s proposed 18-month delay of the applicability date of three exemption provisions in the DOL’s fiduciary rule.  SIFMA believes this delay is critical to provide certainty to investors and the financial services industry and to avoid the expenditure of significant amounts for systems, products or processes required by the amended exemptions, which will almost certainly undergo significant changes.

SIFMA believes that a tiered approach to extending the delay to the later of the 18-month period the DOL proposed and a period ending 24 months after the completion of the review and publication of final rules will best avoid the confusion, uncertainty and cost associated with continued piecemeal delays.

“If these rules go into full effect, they will cause disruption, loss of services and loss of choice for retirement savers.  The negative consequences will be exacerbated if there is no delay,” said Lisa Bleier, managing director and associate general counsel at SIFMA.  “We urge the DOL to carefully review the data that has been submitted by SIFMA and others which supports the conclusion that the DOL rule has resulted in significant harm to investors.  We continue to believe the SEC should take the lead on a broad, principles-based standard of conduct that does not limit the product offerings in the market.”

The DOL’s proposed delay would extend by 18 months the January 1, 2018 applicability date of the provisions in the Best Interest Contract Exemption, the Principal Transaction Class Exemption and Prohibited Transaction Exemption 84-24 relating to the redefinition of the term “fiduciary” under section 3(21) of ERISA and section of 4975(e) of the DOL rule that are not now in effect, along with other amended exemptions.  SIFMA believes any new exemptions should be broad-based, readily understood and implemented, and not dependent on selling a particular kind of class or security.

SIFMA calls for an immediate amendment to the Principal Transaction Exemption for the transition period to remove the limits on products that can be traded on a principal basis, and allow products that have historically been traded in the principal market to continue to be bought and sold by IRAs and plans.

SIFMA also notes that if the DOL proposes changes to the rule and exemptions or proposes new exemptions, then it should also propose commensurate effective date and compliance periods for notice and comment, as the industry will need time to assess and implement compliance with any new rules. Finally, SIFMA requests the DOL to make clear that the non-enforcement policy is also being extended and should coincide with the end date of the extension.

Full text of the letter can be found here.


SIFMA is the voice of the U.S. securities industry. We represent the broker-dealers, banks and asset managers whose nearly 1 million employees provide access to the capital markets, raising over $2.5 trillion for businesses and municipalities in the U.S., serving clients with over $18.5 trillion in assets and managing more than $67 trillion in assets for individual and institutional clients including mutual funds and retirement plans. SIFMA, with offices in New York and Washington, D.C., is the U.S. regional member of the Global Financial Markets Association (GFMA). For more information, visit