Skip to Content

Compliance Corner

Retirement Updates

DOL Extends Temporary Enforcement Policy of Fiduciary Investment Advice Rules

November 09, 2021

On October 25, 2021, the DOL released Field Assistance Bulletin (FAB) No. 2021-02, announcing a temporary enforcement policy related to the prohibited transaction exemption (PTE) 2020-02. The DOL adopted PTE 2020-02 – Improving Investment Advice for Workers & Retirees – on December 18, 2020. The PTE accompanied the amended fiduciary conflict of interest rule that was finalized in June 2020. (We discussed the final conflict of interest rule and the PTE in the July 7, 2020 edition of Compliance Corner.)

PTE 2020-02 became effective on February 16, 2021, but the DOL provided temporary enforcement relief through December 20, 2021. Specifically, the DOL stated that it would not pursue prohibited transaction claims against investment advice fiduciaries who worked diligently and in good faith to comply with impartial conduct standards. Impartial conduct standards require financial institutions and investment professionals to:

  • Give advice that is in the best interest of retirement investors and meet the prudence and loyalty standards.
  • Charge no more than reasonable compensation and comply with federal securities laws regarding “best execution”; and
  • Make no misleading statements about investment transactions and other relevant matters.

FAB No. 2021-02 extends the DOL’s non-enforcement policy through January 31, 2022. The DOL acknowledged that the earlier December 20, 2021 expiration date posed practical difficulties on financial institutions that were in the process of complying with PTE 2020-02.

The DOL also announced that they will not enforce the specific documentation and disclosure requirements under PTE 2020-02 through June 30, 2022.

Although this FAB extends the non-enforcement policy, financial institutions and investment advisors should continue their good faith compliance with PTE 2020-02.

Field Assistance Bulleting No. 2021-02 »

Copyright © 2021 NFP Corp. All Rights Reserved.

Privacy Policy | Legal Notices | Site Map

NFP Corp. and its subsidiaries do not provide legal or tax advice. Compliance, regulatory and related content is for general informational purposes and is not guaranteed to be accurate or complete. You should consult an attorney or tax professional regarding the application or potential implications of laws, regulations or policies to your specific circumstances.

Follow Us

Back to top