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Wagner Law Group is a nationally recognized practice in the areas of
ERISA and employee benefits, estate planning, employment, labor and
human resources and investment management.
in 1996, The Wagner Law Group is dedicated to the highest standards
of integrity, excellence and thought leadership and is considered to
be amongst the nation's premier ERISA and employee benefits law
firms. The firm has seven offices across the country, providing
unparalleled legal advice to its clients, including large, small and
nonprofit corporations as well as individuals and government entities
worldwide. The Wagner Law Group's 32 attorneys, senior benefits
consultant and five paralegals combine many years of experience
in their fields of practice with a variety of backgrounds. Eight
of the attorneys are AV-rated by Martindale-Hubbell
and seven are Fellows of the American
College of Employee Benefits Counsel, an invitation-only
organization of nationally recognized employee benefits
lawyers. Five of the firm's attorneys have been named
to the prestigious Super
Lawyers list for 2017, which highlights outstanding
lawyers based on a rigorous selection process.
Wagner Law Group
Connecticut Avenue, N.W.
Fax: (561) 293-3591
7108 Fairway Drive
Palm Beach Gardens, FL 33418
East Kennedy Boulevard
Tampa, FL 33602
Francisco, CA 94104
25 W. Moody Avenue
St. Louis, MO 63119
February 16, 2018
Files Suit to Enforce
In a recent Alert, we discussed how
several states are charting their own course while the U.S.
Department of Labor ("DOL") proceeds with its review of the
Fiduciary Rule, the Best Interest Contract Exemption
("BICE") and other related exemptions. Yesterday,
Massachusetts filed suit against a broker-dealer firm for violations
of the Fiduciary Rule.
Massachusetts Securities Division of the Office of the Secretary of
the Commonwealth ("Division") filed an administrative complaint against Scottrade, Inc.
("Scottrade") for violations of Massachusetts General Laws
chapter 110A, Section 204 of the Massachusetts Uniform Securities Act
("Act") and the regulations promulgated thereunder.
to the Division, Scottrade adopted policies and procedures designed
to comply with the Fiduciary Rule and related prohibited transaction
exemptions. These policies said Scottrade would not use contests (and
other incentives) that would cause its associates to make
recommendations that are not in the interest of retirement accounts.
Nevertheless, Scottrade allegedly launched two sales contests, the
objectives of which were to generate new assets, including retirement
assets, and offered cash prizes, that the Division asserts were in
violation of its recently-adopted policy.
Division noted that under the DOL's temporary enforcement policy, the
DOL would not pursue claims against investment advice fiduciaries who
were working diligently and in good faith to comply with the
Fiduciary Rule and the BICE. The Division asserts that Scottrade "knowingly
violated its own internal policies related to the Fiduciary
Rule" and that this constituted "a clear demonstration that
Scottrade has failed to act in good faith to comply with the
Fiduciary Rule became applicable on June 9, 2017. Until July 1, 2019,
the "impartial conduct standards" (which we have described
in a prior Alert) are the sole conditions of
the BICE and the related exemptions.
Division's complaint raises numerous issues, most notably, what the
role of state agencies is or should be in enforcing ERISA and DOL
rules. William F. Galvin, the Secretary of the Commonwealth, is a
strong supporter of the Fiduciary Rule. We will monitor this case as
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