The fiduciary rule was scheduled to come into force in April 2017 but will be delayed by 90 days while it is reviewed.
The move forms part of Trump’s strategy to wind back regulations and open up investor options, reports Bloomberg, citing a White House official.
The orders are some of the most aggressive steps yet by Trump to loosen regulations in the financial services industry.
Trump is scheduled to issue the directive halting the implementation at a signing ceremony on Friday, following a meeting with more than a dozen corporate executives.
Carrying on regardless
Investment firms in the US, however, have said the order to halt the implementation of the fiduciary rule is unlikely to derail the customer-friendly changes already underway.
“We plan to go forward with the majority of the work we’ve done,” Bill Morrissey, managing director of business development at LPL Financial Holdings told Bloomberg. “What investors want is more transparency and lower fees.”
On 26 January, Morgan Stanley said that it plans to move ahead with changes to comply with the fiduciary rule, despite uncertainty over whether the regulation will be implemented.
Insurers, including American International Group and Principal Financial Group, also announced after Trump’s victory that they would continue as though the rules would be carried out.
“My expectation is that a lot of firms are going to continue installing a best-interest standard, regardless,” said Brian Graff, chief executive of the American Retirement Association, a group that represents pension professionals, told the newswire.
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