Here’s the latest installment in the long, strange tale of the Department of Labor (DOL) fiduciary rule, originally scheduled to be phased in from April 10, 2017 to Jan. 1, 2018. As of June 21, 2018, the U.S. 5th Circuit Court of Appeals officially vacated the rule, effectively killing it.
President Trump asked for a review of the fiduciary rule shortly after taking office in 2017. First, it was delayed until June 9, 2017, including a transition period for the application of certain exemptions to the rule extending through Jan. 1, 2018. Full implementation of all elements of the rule had been pushed back to July 1, 2019.
Before that could happen – on March 15, 2018 – The Fifth Circuit Court of Appeals, based in New Orleans, vacated the fiduciary rule in a 2-1 decision, saying it constituted “unreasonableness,” and that the Dept. of Labor’s implementation of the rule constitutes “an arbitrary and capricious exercise of administrative power.” The case had been brought by The U.S. Chamber of Commerce, The Financial Services Institute and other parties. Its next stop could be the Supreme Court.
The following Monday, March 19, the Dept. of Labor told CNBC that “pending further review” it “will not be enforcing the 2016 fiduciary rule.”
Finally, On June 21, 2018, the 5th Circuit Court of Appeals confirmed its decision to vacate the rule.