Evolving Standards for Investment Advice Fiduciaries: The New (Old) DOL Fiduciary Rule, Proposed Class Exemption and Regulation Best Interest

Description

The duties and restrictions applicable to fiduciaries under ERISA and the Internal Revenue Code can significantly impact investment advisers, broker-dealers, insurance agents, and other service providers who receive compensation in connection with the recommendation of investments to employee benefits plans and IRAs. ERISA counsel and advisers must understand the rules for determining fiduciary status under ERISA and the Internal Revenue Code and the prohibited transaction rules and exemptions that apply to the compensation of service providers who furnish investment advice.

A prohibited transaction class exemption recently proposed by the DOL would impose “impartial conduct standards” on certain fiduciaries providing investment advice to ERISA plans and IRAs who rely on the exemption for the receipt of commissions and other transaction-based compensation. ERISA counsel and advisers must understand the scope of and conditions for relief under the proposed class exemption, alternative prohibited transaction compliance strategies available to service providers, and the differences between the impartial conduct standards and the standards of conduct imposed under federal and state securities laws.

David C. Olstein, Partner at Stroock & Stroock & Lavan LLP; Jeffrey A. Lieberman, Counsel at Skadden, Arps, Slate, Meagher & Flom LLP; and Steven W. Rabitz, Partner at Dechert LLP, will guide ERISA counsel and advisers on critical challenges and ramifications of the applicable rules for investment advice fiduciaries and new revisions from the DOL. The panel will discuss new standards, essential steps for counsel and advisers, significant responsibilities faced by asset managers, plan providers and sponsors, challenges in constructing a new compliance program under ERISA, and methods in maintaining compliance moving forward.