The 18-month postponement request was outlined in a court brief filed Wednesday in Minnesota related to a lawsuit the Labor Department is a party to. If the delay is approved by the Office of Management and Budget, the effective date for complying with the rule’s remaining provisions would be pushed out to July 1, 2019, from Jan. 1, 2018.
The pieces of the rule facing a delayed effective date pertain to specific written disclosures from financial services firms, including the requirement that advisors earning commissions on investments in retirement accounts sign a legally binding agreement putting their clients’ interests ahead of their own.
While opponents are cheering the delay, they also say the parts of the regulation that already have taken effect are hurting investors.
“The fiduciary rule effectively limits choices for investors because the government and trial lawyers are the ones who define, under the rule, which investments are in the ‘best interest’ of investors,” said John Berlau, a financial policy expert at the Competitive Enterprise Institute.