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With the Department of Labor (DOL) declining to challenge industry groups’ motions for final judgment, the 2024 version of the fiduciary rule known as the Retirement Security Rule has been vacated.
The 2024 rule would have extended ERISA fiduciary duties to cover certain one-time professional retirement investment recommendations such as rollovers, annuity purchases, and plan menu design.
In March this year, the U.S. District Court for the Eastern District of Texas issued a ruling to vacate the rule. The ruling was unopposed by both the DOL and key industry groups.
The department subsequently published guidance on March 20, formally reinstating the 1975 five-part test as the governing standard for determining ERISA fiduciary status and republished Prohibited Transaction Exemption 2020-02 in its original 2020 form. Under the five-part test, a financial professional is only considered an ERISA fiduciary if they provide investment advice on a regular basis, under a mutual agreement that the advice will serve as a primary basis for investment decisions, and for direct compensation.
This outcome doesn’t necessarily signal an end. The DOL has indicated it intends to issue a new version of the fiduciary rule as early as May 2026. The department has not yet issued substantive details but has indicated the rule’s new version “will ensure that the regulation is based on the best reading of the statute” and will align with an executive order calling on departments to reduce regulatory burden.
Sources:
https://www.asppa-net.org/news/2026/3/gavel-comes-down-on-fiduciary-rule-once-and-for-all/
https://www.thinkadvisor.com/2026/03/17/second-judge-vacates-dol-fiduciary-rule-dealing-death-blow
https://401kspecialistmag.com/dol-lets-biden-era-fiduciary-rule-die-in-court
https://www.reginfo.gov/public/do/eAgendaViewRule?pubId=202504&RIN=1210-AC36
https://401kspecialistmag.com/fiduciary-rule-stayed-a-second-time-in-texas/
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