Donald Trump has stated his intentions to undo much of President Obama’s legacy, including his efforts to regulate the financial services industry. Consequently, the DOL’s fiduciary regulation, slated to start phasing in come April 2017, could be in peril.
The Trump campaign noted on its web site that President Trump would establish a moratorium on new regulations, as well as require federal agencies to submit lists of pending regulations. The least critical would receive “priority consideration for repeal.”
Brokers and advisory firms have been spending heavily to prepare for implementation of the rule, and Merrill Lynch has planned even to halt offering commission-based IRAs in order to comply with the rule. The company went so far as to created an ad campaign around the effort, stating that the rule “is a positive step forward for the industry and great news for investors.”
The Trump administration could also exercise its influence by appointing new commissioners to the SEC, as the commission has two openings. In any case, efforts to extend the fiduciary rule to non-retirement accounts are likely to go nowhere. In any case, uncertainty remains as to the new administration’s actions. Until this uncertainty is relieved, market participants should expect plenty of volatility.
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Fiduciary rule ‘in jeopardy’ under Trump | On Wallstreet