The DOL’s 408(b)(2) Regulation: Impact on Broker-Dealers and Registered Representatives

This is another in our series of alerts about the impact on covered service providers of the Department of Labor’s (DOL) “interim final” regulation under ERISA Section 408(b)(2). This alert focuses on the impact of the regulation on broker-dealers and their registered representatives. (By broker-dealer (or B-D) we mean a firm that provides brokerage services to a plan and is not acting as an RIA; we use the term financial adviser (or FA) to refer to the individual registered representative of the B-D who actually services a plan, whether employed by, or acting as an independent contractor agent of, the broker-dealer. Except as otherwise noted, we have limited the discussion to B-Ds that are not dual-licensed or affiliated with an investment provider, e.g., a mutual fund complex, an insurance company, or a recordkeeper/plan provider.)