The Department of Labor’s Fiduciary Rule, which began taking effect in June, is already resulting in some brokerages removing funds – including those with higher fees or those that present perceived risks – from their sales platforms. A recent Wall Street Journal article featuring Alma Piscitello, NLD Executive Vice President, Strategic Adviser Services, assesses the implications.

“If you have more than 5,000 mutual funds on your platform, that oversight is a lot of work,” said Alma Piscitello, executive vice president of Northern Lights Distributors, which provides underwriting services and counsels investment managers on fund distribution.

Some brokerage and advisory firms have already told Northern Lights of funds being pulled from brokerage platforms because of the fiduciary rule, generally because of size or expense, Ms. Piscitello said.

Under the Obama-era regulation, which aims to eliminate conflicted advice that can arise based on incentives to sell financial products, those offering financial advice to retirement savers may earn commissions and compensation that might give them an incentive to recommend one product over another, but must do so under an exemption. For advisers who use the exemption, any fees must be level with similar investment products or services. That has put mutual funds, with their varying share classes and costs, under the spotlight.