Structured Thoughts: News for the financial services community, Special Issue: Implications of the DOL Fiduciary Rule for Structured Products

On April 6, 2016, the Department of Labor (“DOL”) issued its final conflict of interest regulations, which significantly expand who is considered a fiduciary when dealing with a retirement account. The new regulations, together with a number of amended and final prohibited transaction exemptions that were concurrently released, exceed 1,000 pages (the “Regulations”),1 and apply to IRAs and to pension and 401(k) plans that are covered by ERISA.

The new Regulations sweep within the concept of “fiduciary” broker-dealers and other financial advisors who provide any investment recommendation to a retirement plan or an IRA. As a fiduciary, a broker-dealer would be required to act in the best interest of its customers and would generally be prohibited from receiving commissions or other variable compensation. In order to receive transaction-based compensation when dealing with a retirement account, a broker-dealer would need to fit the transaction within one of the exceptions or exemptions set forth in the Regulations. As discussed in this article, sponsors and distributors of structured products should review their structured product programs as well as related distribution and compensation arrangements in order to comply with the new Regulations. The Regulations will begin to become effective on April 10, 2017.

Please see full publication below for more information.

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

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.

© Morrison & Foerster LLP - Structured Products | Attorney Advertising

Written by:

Morrison & Foerster LLP - Structured Products
Contact
more
less

Morrison & Foerster LLP - Structured Products on:

Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
- hide
- hide