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Friday, February 14, 2020

Breaking News on Rollovers: What DOL Really Did on April 5

We want to bring something very important to your attention regarding DOL Fiduciary Rule delay that was announced yesterday. The rule is delayed until June 9th and further examination of various provisions will happen throughout 2017. So, what will really happen on June 9th? Something very important. Any rollover advice will now have to be provided under the new fiduciary standard and Impartial Conducts Standard.

I spoke today with Micah Hauptman, a fiduciary expert and a financial counsel at Consumer Federation of America. I asked him to explain how this ruling affects IRA rollovers. Here is what he said :

“It’s important to note that, because rollover recommendations are now explicitly covered under ERISA, any recommendations to roll over must comply with the impartial conduct standards beginning on June 9th. Violation of these standards would constitute a prohibited transaction. In addition, because there is a private right of action under ERISA, an investor who is harmed based on a violation of these standards could directly enforce their rights.”

It is hard to discern noise from information around this delay, but from this analysis it is clear that advisors need to be ready to substantiate that they are acting in the best interest of the investor come June 9th.

We at RiXtrema have been one of the few voices confident that the Impartial Conducts Standard will ultimately come into effect and that ERISA world is ‘invading’ the rest of financial advice. ERISA fiduciary standard is one of the strictest legal standards ever devised. Because we were confident that this part of the rule will ultimately survive we have invested a great deal of effort into creating IRAFiduciaryOptimizer, the only Best Interest Rollover solution based on quantitative finance. Bob Veres called IRAFO in his thorough study of DOL Rule solutions “…arguably, the most comprehensive DOL Rule solution.”


There is actually very little time to prepare before June 9th, so we urge you to contact us to find out how we can prepare you for the fiduciary era in rollover advice. Here is a detailed 8 minute video describing IRAFiduciaryOptimizer and how it can help you demonstrate if you are acting in investor’s best interest.

You can request IRAFiduciaryOptimizer demo here.

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