EBSA Denies Comment Period Extension for Fiduciary Proposal

The Employee Benefits Security Administration has denied multiple requests for an extension of the comment period on the fiduciary adviser rule proposal, declining to heed the advice of, among others, 18 organizations that sent a letter to the regulator last week.

EBSA will host virtual public hearings beginning on December 12, and the comment period will expire on January 2, 2024, as originally scheduled.

The proposed rule amendments, called the “retirement security” proposal, would extend fiduciary status to advisers making regular one-time recommendations such as rollovers and to insurance professionals who make one-time recommendations for annuity products with retirement assets.

Industry actors had previously written to EBSA to ask for at least an additional 30 days to comment on the proposal. They noted that the rule is sophisticated and deeply consequential, and the comment period overlaps with many federal holidays.

Assistant Secretary of Labor Lisa Gomez, in a response to the Securities Industry and Financial Markets Association, wrote that EBSA had engaged informally with many stakeholders prior to the proposal’s publication. Gomez, who heads EBSA, added that the agency has been working on regulating this space since about 2010 and was already familiar with the issue.

“At this point, EBSA does not intend to extend the comment period or delay the hearing,” Gomez wrote in the letter. “If you or any of your members would like to discuss any of the issues in the proposed rulemaking package with EBSA, we would be happy to set up a meeting, which would become part of the public record for the proposal.

The Insured Retirement Institute, which was among the trade groups that had requested an extension of the comment period, Wednesday called EBSA’s decision “disconcerting and frustrating.”

In addition to criticizing the rejection of the request for more time, IRI questioned why the DOL set the public hearing date for December 12.

“Such a short comment period for major federal rulemaking does not allow for meaningful public engagement,” said Wayne Chopus, president and CEO of IRI, in a statement. “I find it hard to understand why the Biden Administration is needlessly rushing to finalize a nearly 500-page proposed rule affecting retirement planning and financial security for millions of workers and retirees. “