The Labor Department has reopened its official feedback channels to see what the industry has to say about delaying or entirely rescinding its controversial standard on retirement advice. The industry isn't exactly shy.
The first 1,105 comments have now been posted to the DOL site and as yet the agency has yet to load anything dated beyond March 17.
I see the usual industry heavyweights along with a lot of individual professionals arguing coherently and passionately for relief -- even in the worst scenarios, retail investors survived this long without forcing advisors into a no-win posture.
There are a few consumer groups in the mix as well arguing that deeper constraints are needed in order to protect the public from bad or even just imperfect actors.
At this point it's a mystery to me where the traditional regulators have gone. Are FINRA and the SEC eager to let DOL do all the heavy lifting monitoring these accounts? Why not simply let the labor bureaucrats supervise retail advisors -- since the nest egg is such a huge piece of mass market liquid assets -- and leave more rarefied relationships to the existing industry enforcers?
Why not create an entire new class of pure retail or "retirement" advisor, while we're at it? That way, people who focus on taxable accounts could go on with their existing business, from credentialing to compensation.
But that's a side note. For the time being, it's open season for everyone to get their opinions on the record.
There are also 23 petitions on the topic with a total of 194,000 signatures arguing all sides, from pleas to delay or rescind to a huge 119,000-comment rebuke that the industry has had more than enough time to prepare.
It's clear that consumer groups are being mobilized here. That's not terrific because if those people are so eager for the new rules, they're also potential consumers of the advice.
Whatever the DOL does, they're going to vote with their wallets, going to advisors who meet their standards one way or another.
I've been saying for years that voluntary compliance is a marketing edge. After all, most if not all firms have already gotten ready for the rule to kick in, so it's a relatively small step to start operating as though it had.
But in the meantime the arguments go on. Two years ago DOL collected close to 4,000 comments on the draft rule and actually took them seriously enough to amend the final regulation.
This time around, 1,100 comments in two weeks feels like only the tip of the rhetorical iceberg.