ABA Requests Compliance Extension to Department of Labor Investment Advice Exemption

The American Bankers Association requested that the Department of Labor extend the Dec. 20, 2021, compliance date regarding an investment advice exemption. Retirement service providers, including a number of ABA member banks, intend to rely on Prohibited Transaction Exemption 2020-02, “Improving Investment Advice for Workers & Retirees,” to continue providing investment advice for compensation to retirement plans and to individual retirement accounts.

The extension request identifies and describes implementation issues and challenges that, due to the complexities, processes, and time constraints involved to achieve compliance, warrant a 180-day compliance extension for PTE 2020-02. ABA pointed out issues with rollover cost comparisons, vendor procurement process and solutions development, bank personnel training, and internal reviews and revisions of policies, procedures, and related matters, and approvals.

ABA said that a 180-day extension beyond the Dec. 20 compliance date would assist banks in working to address and resolve these and other compliance issues internally and with their vendors.