On April 23, 2024, the U.S. Department of Labor released the Retirement Security Rule defining who is an investment advice fiduciary for purposes of the Employee Retirement Income Security Act (ERISA). The new rule will extend ERISA's fiduciary requirements to all advisers, brokers and insurance agents who provide advice on IRAs, including rollovers. The change starts going into effect on Sept. 23, though it might face legal challenges. The industry will then have another year to fully comply, the Labor Department said.
Join retirement plan expert Kevin Clark for a review of key requirements advisers must adhere to, to include the following:
- Meet a professional standard of care when making recommendations (give prudent advice);
- Never put their financial interests ahead of the retirement investor's when making recommendations (give loyal advice);
- Avoid misleading statements about conflicts of interest, fees, and investments;
- Charge no more than what is reasonable for their services; and
- Give the retirement investor basic information about the adviser's conflicts of interest.