Asset managers who have led the fight against the Labor Department’s fiduciary rule say business will continue as usual in the wake of this month’s changes to the best interest” standard for investment advisers — changes that could mean the end of the Obama-era regulation but the beginning of oversight by the Securities and Exchange Commission.

The fiduciary rule that went into partial effect in June by limiting the extent to which retirement advisers can put clients into high-commission products has met resistance from industry leaders, Republican lawmakers and business groups that contend it will limit their product offerings. Opponents of the regulation scored a major victory on March 15 when the U.S. Court of Appeals for the 5th Circuit vacated the rule in a 2-1 decision.

The court ruling raises the prospect that the regulation could go away completely as soon as May if the Labor Department decides not to appeal the decision. The agency has not indicated its plans on that front.

Mark Halloran, senior vice president for business development at The Transamerica Corp., said in a March 28 interview that in the immediate future he does not think his firm will undergo a “significant rollback” to the pre-fiduciary rule landscape, and that the appeals court ruling is welcome news.

“There was risk in terms of litigation within the rule for broker-dealers in particular, and that will kind of revert to the level of risk that was in place prior to the promulgation of the rule,” Halloran said.

His comments echoed those of other firms. New York-based Voya Financial Inc. said in a March 19 statement that it will maintain a “best interests approach” to client services and that “it is business as usual at Voya.”

Meghan Reilly, a spokeswoman for Boston-based Fidelity Investments, said in a March 28 email statement that the firm is “actively working through contingency options,” but for now, “we intend to continue to provide the same services to our clients and their participants as we have been since the DOL Rule became effective.”

With the Labor Department rule possibly on the way out, the SEC has been ramping up its engagement with the fiduciary standard, taking comments from industry stakeholders about how the agency should craft its own rule. SEC Chairman Jay Clayton said during a question-and-answer session hosted by the Securities Industry and Financial Management Association on March 19 that litigation related to the Labor Department rule “hasn’t affected” how he approaches the substance or timing of the best-interest regulation.

The prospect of an SEC rule is one reason why some firms aren’t planning to make any immediate changes.

Christina Winters Gears, president and chief executive of the Irving, Texas-based firm Creating and Managing Wealth LLC, said in a March 29 interview that she expects an SEC regulation to require similar compliance costs as the Labor Department rule, meaning she doesn’t intend to change her company’s strategy as a result of the recent court ruling.

In June, the Labor Department said it was postponing implementation of the remaining elements of the fiduciary rule as it took comments from the industry regarding potential changes. After the 5th Circuit’s decision, an agency spokesperson said that pending further review, the Labor Department will not be enforcing the rule.

Anya Coverman, general counsel and senior vice president for government affairs at the Investment Program Association, a trade group that represents broker-dealers, said in a March 26 interview that in the next few months, firms are likely to reevaluate what changes might be necessary because of the ruling, combined with the SEC’s possible actions. She added that companies might decide to hold off on investing in fiduciary rule-related compliance.

“There are firms that have invested a lot of time and money” making changes because of the rule, Coverman said.

The SEC did not respond to requests for comment.

Stephen Hall, legal director at the Washington-based advocacy group Better Markets, which favors the DOL rule, said in a March 29 interview that if the recent appeals court ruling goes unchallenged, brokers could revert to behavior that was essentially prohibited by the regulation.

“One of the unalterable facts is that investors will not have the private enforcement mechanism that they would have otherwise had,” Hall said. “That will undoubtedly have some impact on how firms behave.”

He added that private remedies such as those outlined in the Labor Department rule would provide a deterrent for bad behavior, while also allowing wronged investors to get the appropriate legal relief. Additionally, the DOL rule provides the strongest possible enforceable best-interest standard, which would disappear in the absence of the agency’s regulation, according to Hall.

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