With broker dealers and advisors at risk of prohibited transactions when recommending IRA rollovers if they are not in compliance with the DOL’s PTE 2020-02, Fiduciary Decisions has put forward solutions to help.
In experiencing a surge in requests from broker dealers and RIAs for assistance in complying with the DOL’s PTE 2020-02, Fiduciary Decisions CEO Tom Kmak notes that the firm anticipated and planned for this. “Investors want and need recommendations,” he explains. “Most rollover recommendations are now considered fiduciary advice. As ERISA fiduciaries, firms must support advisors in avoiding prohibited transactions.”
With the compliance date of Dec. 21, 2021, now only six months away and recent reports of planned enforcement around IRA rollovers recommendations, this issue has become priority number one for the industry, the firm notes.
“Current IRA workflows do not address the requirements of the PTE,” says Matt Golda, Chief Operating Officer at Fiduciary Decisions. “So, firms are taking steps to supplement their current process or reviewing stand alone solutions that address it.”
The IRA Rollover Compliance solution helps service providers comply with DOL PTE 2020-02 and produce a client-ready output that documents their IRA rollover recommendations. According to the announcement, FDI supports broker dealers and RIAs with compliance through the following solutions:
- Full-Service Compliance Solution—which FDI has been offering since 2016—captures required data, creates side-by-side comparisons and supports compliance workflows;
- FDI Connect enhances existing workflows by offering components (data, method and/or output) that can be incorporated into a firm’s existing rollover workflow, as well as integration via flexible APIs; and
- Plan Benchmarking data for when actual plan data is not available, allowing firms to avoid using incomplete or unavailable public filing or crowd-sourced plan data.
“As we approach the compliance date, it is the flexibility of our solution coupled with access to our high-quality plan benchmarking data that makes us unique,” emphasizes Michael Narkoff, Head of Sales at Fiduciary Decisions.
“In 2011, DOL 1.0 didn’t make it. In 2018, 2.0 was vacated. But, now 3.0 is here and it is moving forward and there is likely more regulation to come,” adds Craig Rosenthal, Head of Strategy and Chief Marketing Officer at Fiduciary Decisions.
