Merrill Lynch may keep commission-based retirement accounts: source www.reuters.com
Merrill Lynch, a unit of Bank of America Corp, may not entirely do away with its commission-based retirement accounts, after Trump ordered the Labor Department last month to delay the proposed retirement-savings rule.
In a conference call with the advisors on Thursday, the bank said it plans to shift most of its retirement savers to accounts that charge a fee based on percentage of assets from those that charge a commission, according to a source familiar with the matter.
However, Andy Sieg, head of Merrill Lynch Wealth Management, noted in a memo seen by Reuters that the account conversions may not apply to all of its customers.
"We've recognized that there may be limited situations in which a fee-based arrangement would not be in a client's best interests. We are reviewing those limited circumstances to consider potential alternatives to IAP for some clients in a manner consistent with a higher standard of care," Sieg said in the memo.
Last month U.S. President Donald Trump ordered the Labor Department to review the implementation date of the new fiduciary rule, proposed by Obama, which was set to take effect in April.
The proposed rule was staunchly opposed by the financial services industry. Wall Street had argued that the rule would harm consumers as it would raise compliance costs and therefore fees, and force them to get rid of Main Street clients and small businesses that offer 401(k) plans.
Merrill Lynch was not immediately available for comment.
The Wall Street Journal had earlier reported that Merrill Lynch was planning to still offer commission-based retirement accounts.
Published Date:2017-03-10