PLANADVISER - November/December 2017 - 34

2017
PLANADVISER
NATIONAL
CONFERENCE
Above and Beyond: How leaders are confronting
fiduciary change and new market realities
T
emporarily blown off course
by Hurricane Irma, the 2017
PLANADVISER National Conference
(PANC) breezed into its new time
slot, October 11 through 13, at the J.W.
Marriott in Orlando, Florida, retaining
all of the panels and extras that had
been planned for it previously.
Top-tier retirement plan specialists
from around the country-including
many from the PLANADVISER Top 100
and the PLANSPONSOR Retirement
Plan Advisers of the Year-shared
wisdom for how to navigate the fiduciary
landscape and benefit from
expected market changes, among
other timely topics.
Washington Update
Thomas Clark Jr., a partner with The
Wagner Law Group, underscored to the
2017 PLANADVISER National Conference
audience that " the fiduciary rule
is in effect. It became effective in 2016
and was put into practice this past
June, " he said.
" What is being delayed ... [is implementing]
the complicated exemptions, "
he said. " The DOL [Department
of Labor] has proposed delaying
them an additional 18 months, until
2019. It is processing the comment
[letters] and will send [the proposed
rule] to the OMB [Office of Management
and Budget]. It will then need
to publish [the rule] in the Federal
Register. Consumer protection groups
have threatened to sue if the 18-month
delay is put into effect. "
However, noted David Levine, a
principal with Groom Law Group, Chartered,
" The U.S. Chamber of Commerce
might countersue, or the DOL might
say that the fiduciary rule wasn't done
properly. It's kind of like the bills to
repeal Obamacare, " in that the efforts
to squash the fiduciary rule's best
interest contract exemptions (BICEs)
have, so far, been for naught. " For those
who wish for this to die, you might get
it and regret it because the DOL might
interpret the old rule in a new way, "
Levine said.
In addition, he continued, " The SEC
[Securities and Exchange Commission]
is talking about a combined
fiduciary standard for brokers and
RIAs [registered investment advisers],
although it doesn't have oversight of
ERISA [Employee Retirement Income
Security Act]. [DOL] Secretary Acosta
said he is talking with the SEC, and
the states themselves can take their
own actions. "
The bottom line, Levine stressed, is
that " even though everyone has 'fiduciary
rule fatigue,' the rule is not dead. "
" The only thing delayed is the
exemptions, " Clark agreed.
Levine stressed to the audience
that, in the interim, advisers will " have
to follow impartial conduct standards
and document their processes, even
though the processes are vague. "
Certainly, Clark said, a big part of
these standards for advisers is ensuring
that " their own fees are reasonable " -
and benchmarking them.
Levine conceded that " there is no
hard and fast way to determine if your
fees are reasonable " but that advisers
should not be too concerned about
this. " I think this is a litigation loser,
a tempest in a teapot, " he said. " DOL is
not pushing too hard on this. "
The important
thing for advisers
to remember, Clark said, is to " have a
process to document [your] fees and
meet the impartial conduct standard. "
It is also a good practice to charge level
fees, rather than fees based on commissions
or revenue sharing, he said.
34 | planadviser.com november-december 2017
Art by Jing Wei; Photography by Matt Kalinowski
http://www.planadviser.com
PLANADVISER - November/December 2017

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