The US Labor Department’s ongoing push to regulate retirement investment advice encountered a setback in court, where a federal magistrate judge recommended that portions of the agency’s 2020 guidance be vacated.
The department’s new interpretation of fiduciary status fails to properly distinguish between employer-sponsored retirement plans and individual retirement savings vehicles, which are treated differently under the federal Employee Retirement Income Security Act, Magistrate Judge Rebecca Rutherford said.
The guidance should be vacated to the extent it allows a financial professional’s fiduciary status to turn on advice given in the context of an individual retirement account, she said.
The guidance ...