DOL Adopts Final Regulation on Exemption for Participant-Level Investment Advice

more+
less-

The U.S. Department of Labor (DOL) has adopted a final regulation to implement the statutory exemption from the prohibited transaction rules of the Employee Retirement Income Security Act of 1974, as amended (ERISA), for the provision of investment advice to plan participants and beneficiaries and owners of individual retirement accounts (IRAs). Under this rule, a financial services firm, such as a registered investment adviser, bank, or registered broker-dealer, may provide advice on investments in its proprietary investment products, or on other investments that would result in fees or other payments to the firm, if the firm complies with a fee-leveling requirement or the advice is furnished using a certified computer model. The effective date of the final regulation is December 27, 2011.

This LawFlash provides a brief overview of the statutory exemption and the final regulation and highlights some of the main issues raised by the comments. The concluding section offers some observations about the practical impact of the regulation and the current status of the law on participant investment advice.

Please see full article below for more information.

LOADING PDF: If there are any problems, click here to download the file.

Published In: Administrative Agency Updates, Finance & Banking Updates, Labor & Employment Updates, Science, Computers & Technology Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Morgan Lewis | Attorney Advertising

Don't miss a thing! Build a custom news brief:

Read fresh new writing on compliance, cybersecurity, Dodd-Frank, whistleblowers, social media, hiring & firing, patent reform, the NLRB, Obamacare, the SEC…

…or whatever matters the most to you. Follow authors, firms, and topics on JD Supra.

Create your news brief now - it's free and easy »