“With the DOL’s fiduciary rule and the new and amended exemptions associated therewith (the “Rule”) officially vacated, many are wondering about the implications of the DOL’s last statement of its (and the IRS’) temporary enforcement policy (FAB 2018-02). In the absence of the Rule we are back to the old “5-part test” for determining whether one is an investment advice fiduciary. If one is an investment advice fiduciary under the 5-part test, the temporary enforcement policy would seem to provide what is the equivalent of a prohibited transaction exemption that did not exist prior to the Rule (for example, to permit the investment advice fiduciary to receive third-party compensation assuming the “impartial conduct standards” are satisfied). Whether the DOL would agree with this analysis in all cases and how long this temporary enforcement policy will be maintained remains to be seen.”
