The DoL and putting the customer first

The rules governing how the retirement savings of retail investors in the US should be treated have changed fundamentally following the Department of Labor's recent promulgation of a fiduciary standard that financial advisers and investment brokers are obliged to meet from April 2017 onwards. In this new dispensation, financial advisers and investment brokers are now required to put the best interests of their client first in all the investment advice and the product offerings they offer.

Although many firms have already moved in this direction, the legal requirement that customers best interests should be paramount has significant consequences in terms of the systems, processes and operations that advisory firms and brokers will need to have in place to demonstrate that they meet this standard. There is much to do to be ready.

We talk with Gary Jones to discuss a number of key topics that should now be on the agenda of any adviser or broker:

  • What does it actually mean to put customers first?
  • What has to change in this new regime to be compliant?
  • What can be learnt from RDR (Retail Distribution Review) in the UK and the impact it has had so far?
  • What is suitability and what does that mean for pre-client proposals right through to ongoing client management?
  • What impact does that have on RIAs and IBDs if they are to meet this new fiduciary standard in terms of their key systems and processes to meet suitability standards?
    What are the 3 - 5 key actions that should be done right now to be ready?