The part of the Labor Department's fiduciary rule that has heartened supporters and caused heartburn for opponents, the best-interest contract, could become a casualty of the ongoing reassessment of the rule, Investment News reported today. The DOL said last week in a court filing in a lawsuit over the regulation that it is seeking an 18-month delay in the implementation of the remaining parts of the rule. Two provisions became applicable in June. The time-out will give the agency plenty of opportunity to undo the contract, which backers of the rule say gives it bite. Critics say that it is too complicated and raises liability costs. Under the legally binding agreement, brokers can earn variable compensation on products they sell to retirement investors as long as they act in investors' best interests. The regulation allows investors to file class-action lawsuits over violations, a provision that financial industry opponents are targeting. The request for information that will guide DOL's review of the rule, which was mandated by President Donald Trump, includes questions about the best-interest contract, providing a hint about DOL's intention to eliminate or change it.
