Despite the fact that the fiduciary rule has not yet been implemented and there are numerous efforts underway to repeal it, it is already causing great harm. That is the view of Paul Schott Stevens, head of the Investment Company Institute, a trade group and opponent of the rule. He says that hundreds of thousands of retirement accounts have already been “orphaned” by the forthcoming rule, as it forces advisors to get rid of small clients. Summarizing the situation, he said “Faced with the sizable if uncertain legal and regulatory risks of assuming DOL fiduciary status vis-à-vis these fund shareholders, brokers are simply resigning from small accounts en masse”.
FINSUM: It seems that though the fiduciary rule has not been implemented, the harm it was set to cause is already occurring. We are in no way opposed to fiduciary duty in principle, but we disagree with how the DOL is seeking to implement such changes.