Industry players are weighing in on the Department of Labor's proposal to delay the fiduciary rule's implementation date by 60 days. Baird is going a step further, suggesting the regulation be postponed "by a year or more."
The regional firm is among the first to issue a formal comment letter on the proposal, which the Labor Department says is necessary in order to complete a regulatory review ordered last month by President Trump.
Baird supports a delay in order to avoid confusion.
"No retirement investor's interest will be served if the fiduciary rule goes into effect before we have certainty on the products and services that can be provided under the final rule," the firm says in its letter, which is available on the Labor Department's website.
The industry has marshalled enormous resources to comply with the new regulation, which is set to take effect April 10.
"We have spent a tremendous amount of money and staff hours comprehending and analyzing the rule, revising how our business runs, changing our policies and procedures necessary to make the enormous shift required by the new rule, drafting client disclosures, correspondence and explanations of revised product offerings necessitated by the rule, and creating compliance and surveillance programs, in addition to a host of other requirements necessary to comply with the rule," the Milwaukee-based company said in the statement.
Baird's wealth management unit has more than 875 advisers and $115 billion in client assets, according to the company.
Several other brokerages have also filed comment letters, including UBS, Stifel, Neuberger Berman Investment Advisors and Ladenburg Thalmann Financial Services. All four firms support a delay.
Like Baird, UBS expresses concern about clients being confused if changes are made to the rule after it is implemented.
Ladenburg suggests a 180-day delay for all aspects of the regulation.
Because the rule's current "requirements that compensation be level within a product category (ex. fixed index annuity product category), Ladenburg will be forced to significantly reduce retirement products available to investors," the company warned in its letter.
More firms, trade organizations, investor advocacy groups and advisers are expected to file letters before the comment period ends on March 17. The Labor Department has posted 285 comments so far.
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