Regulators are seeking to delay the deadline for financial advisers to fully comply with a rule that would require them to act in their customers’ best interest, according to a federal court filing on Wednesday.
The Labor Department, which sent the proposal to the Office of Management and Budget, said it wanted to push back the full implementation of the so-called fiduciary rule to July 1, 2019, from Jan. 1, 2018, according to a court document filed in Federal District Court in Minnesota.
The first part of the fiduciary rule took effect in June, and requires brokers, financial advisers and insurance agents to put their customers’ interests ahead of their own, at least when they are handling their retirement accounts.
But the final pieces that are not yet in place are what gives the rule its teeth: Among other things, the rule would require financial professionals with conflicts of interest to sign a contract with customers, making the rule legally enforceable.
The court document had few details, but was part of a lawsuit filed by Thrivent Financial for Lutherans against the Labor Department, which oversees retirement accounts. A spokesman said the proposal would be published in the Federal Register on Thursday, but declined further comment.
Just a month after President Trump took office, he ordered a review of the regulation, which has been strongly opposed by the financial services and insurance industries.
