“An (In)Decent Re-Proposal? – DOL’s Revision to Fiduciary Definition Has a Familiar ‘Ring'”
On April 14, 2015, the Department of Labor (“DOL”) released its long awaited “re-proposal” (the “Re-Proposal”) to re-craft the definition of fiduciary as it applies to the many providers of services to employee benefit plans subject to the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), and plans, such as individual retirement arrangements (“IRAs”) subject to the Internal Revenue Code of 1986, as amended (the “Code”), (collectively “Plans”). The Re-Proposal would change the existing definition of “fiduciary,” and provides for the issuance and/or modification of several prohibited transaction exemptions – many of which may cause current practices to be altered. Given the scope and complexity of the Re-Proposal, we do not undertake to provide a detailed assessment of the potential impacts in this Stroock Special Bulletin. Rather, in the coming days, we will provide an analysis of the Re-Proposal and its potential implications for Plans and market participants. For now, given the enormous importance of this topic to clients and friends, we provide a very brief initial assessment of the Re-Proposal.