Correction and Reporting of PTE 2020-02 Mistakes
The Department of Labor’s Prohibited Transaction Exemption (PTE) 2020-02 is now fully effective. As a result, in
most cases where investment recommendations are made to retirement accounts (that is, retirement plans,
participant accounts-including rollover recommendations, and IRAs-including recommendations to transfer
IRAs), broker-dealers and investment advisers will be fiduciaries for those recommendations.
Where the advice is conflicted (for example, if it results in a commission or other compensation), the receipt of that
compensation is prohibited. However, the DOL’s PTE provides relief from the prohibited transaction rules, but only
if its conditions are met.
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