How Big Broker-Dealers Are Buying Small Broker-Dealers, and What That Means for the Advisor

The past few years have been a whirl for advisors at smaller broker-dealers. Consolidation in the industry is rampant — last year’s 138 mergers and acquisitions were a record, according to Echelon Partners, and were a 10 percent increase compared with 2015, which had also been a record year. “For owners of smaller broker-dealers, it provides a great opportunity to sell a business and earn an exit payout,” says Evan Tarver, investments editor at FitSmallBusiness.com, a New York City-based business service that provides advice to small businesses. “For the advisers employed by these broker-dealers, it might be negative as they may be losing their jobs.” Here’s the latest on M&As among broker-dealers. What’s Inspiring These Acquisitions? In many cases, the U.S. Labor Department’s proposed fiduciary rule and the corresponding increased cost of doing business has been inspiring smaller and independent broker-dealers to look for other options, experts say. While parts …

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What Workers Need to Know About the New DOL Overtime Rule

You may have heard about a new rule that might mean changes to whether you get compensation for working overtime. The Department of Labor provided more information about which white-collar employees are now covered by minimum wage and overtime rules. The new overtime regulation will have a tremendous impact on employees, says Micah Longo, an employment lawyer with The Longo Firm. Under the new regulation, employees who make less than $47,476 will be entitled to overtime pay, no matter their job duties, Longo says. Here’s what you need to know. Your Salary Might Go Up Your employer has several options to ensure compliance under the new rule. Your employer may boost your pay to more than $47,476 a year to remove you from overtime protections, Longo says, or it may limit you to 40-hour work weeks, which may include tracking your hours. Your employer also may ask you to track …

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What Does the Future Hold for the Fiduciary Rule?

The U.S. Labor Department’s so-called fiduciary rule, proposed during the Obama administration, would change the status of some financial professionals under the Employee Retirement Income Security Act (ERISA). It was originally supposed to be implemented in phases earlier this year but ran into delays and reviews. Now, Rep. Ann Wagner, a Republican from Missouri, has introduced a bill that would make some changes to the latest ruling, including giving the Securities and Exchange Commission the lead on fiduciary regulation, in place of the DOL. “The fiduciary rule in its current form renders all investment professionals who work with retirement plans or advise retirement plans [as] fiduciaries under the ERISA definition,” says Raphael Katz, a partner at the law firm Sadowski Katz. This results in a strict standard against self-dealing, he says — but that could change. Here’s what you need to know. The Proposed Change Wagner and financial industry proponents …

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What the DOL’s Fiduciary Rule Means for Financial Professionals Now

What the DOL’s Fiduciary Rule Means for Financial Professionals Now

The U.S. Labor Department’s so-called fiduciary rule has a long history, and it appears it’s not over. Proposed under the Obama administration, the rule would change the status of some financial professionals under the Employee Retirement Income Security Act (ERISA). It was originally supposed to be phased in in April but has been delayed until June, with a transition period for some exemptions extending through Jan. 1, 2018. In addition, the Trump administration may want to make more changes. For financial professionals, it’s vital to stay up-to-date on the changes. “Good faith is not enough,” says Ronald Surz, president of PPCA. Here’s what financial advisers, especially those who work on commission, need to know. It Establishes Broader Fiduciary Responsibility Under the rule, all financial professionals who work with retirement plans, ESOPs, IRAs and so on, or who provide advice about retirement plans, will have to act in a fiduciary capacity. …

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What President Trump’s DOL Action Means for the Advisor

What President Trump’s DOL Action Means for the Advisor

There’s been a lot of confusion in the past few days about the fate of the Department of Labor’s (DOL) Fiduciary Rule. It was widely reported on Friday that President Trump would be signing an order to delay the rule for six months pending further investigation. However when the order was finally issued on Friday afternoon things changed once again, so let’s get to the bottom of things. Only one order was signed (not two as originally expected) which had no specific reference to the Fiduciary Rule. Instead, President Trump has directed the Secretary of the Treasury to conduct a 120-day review of all laws and regulations related to the financial industry. The President also signed a memorandum on the Fiduciary Rule which although doesn’t specifically call for any delay in the ruling does call for a substantial review. According to Section 1 of the memorandum, “You [DOL] are directed …

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