The Department of Labor is ready to advance as soon as the end of the month a final rule that would raise investment advice standards for retirement accounts. The department is trying to get the rule to the Office of Management and Budget (“OMB”) for review by January 31, according to a report published by Politico.
The review could take up to 90 days, but could be expedited and finished within four to six weeks. Once the office has approved the rule, it would be sent back to the Labor Department, which would then publicly release the final rule in the spring.
“The rumor mill is very active,” says Fred Reish, a partner at Drinker Biddle & Reath. “The prevailing thinking is that the final package of the regulation and exemptions will go to OMB in the next three weeks and could go any day now. The tea leaves say that the fiduciary package will be … published in the Federal Register somewhere between mid-March and mid-April.”
After a final rule is published, Congress will have 60 days to adopt a joint resolution of disapproval, if it wants to stop the regulation. However, if Congress approves a resolution to kill the rule, President Obama will likely veto it, as he has come out in strong favor of the rule.
Moving it toward finalization this month would likely make it effective before the end of the Obama administration next January. Under the proposed rule, firms would have eight months to implement it.
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