In an important development, the Labor Department has issued a new proposal to address conflicted investment advice provided by ERISA fiduciaries:
- Consonant with the vacatur of its 2016 rule, DOL reinstated the longstanding 5-part test of investment advice fiduciary status, but announced new interpretations of that test that will cause rollover advice and possibly other interactions to become fiduciary advice.
- DOL also proposed a new, principles-based class exemption broadly available for conflicted advice and intended to align with other bodies of law to which financial institutions are subject.
