The US Department of Labor’s ruling regarding client best interest for retirement investing will take effect in April 2017, making it critical that wealth management firms focus on achieving compliance. This ruling forbids advisors from receiving variable commissions for conducting transactions within retirement accounts.
However, achieving compliance is proving a challenge for many firms, as many industry players are still working to better understand the requirements set forth by the ruling and decide how to fulfill them. Some firms are focused purely on generating the Best Interest Contract, although a more comprehensive solution would be one that not only puts the contract in place, but also ensures ongoing compliance with client best interest investing. Ideally, firms will review organization-wide processes and make adjustments as necessary to ensure overall compliance with client best interest requirements.
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