Texas Judge May Determine Future of Fiduciary 401(k) Exemption

The US Labor Department’s ability to regulate retirement plan asset rollovers now hinges on a single Texas federal district court judge who can decide whether to preserve status-quo limits or strip the department of even more regulatory authority.

US District Court for the Northern District of Texas Judge Ed Kinkeade can either approve, reject, or expand on a magistrate judge’s recommendations to vacate a portion of the department’s 2021 prohibited transaction exemption that redefines when consumer financial professionals would be held to strict fiduciary standards of conduct under federal benefits laws.

Those recommendations closely align with a February district court ...