Regulation — RIA-specific
DOL PTE 2020-02 — Investment Advice Fiduciary
Prohibited Transaction Exemption 2020-02 governs the fiduciary status of an adviser recommending a rollover from an ERISA-covered plan (401(k), 403(b)) into an IRA. The 2025 reinstatement and strengthening made it the default operating framework for every rollover recommendation captured in AI-driven onboarding flows.
What the regulation actually says
"… the Financial Institution and Investment Professional must provide investment advice to the Retirement Investor that is, at the time of the recommendation, in the Best Interest of the Retirement Investor. Investment advice is in a Retirement Investor's Best Interest if such advice reflects the care, skill, prudence, and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with such matters would use … based on the investment objectives, risk tolerance, financial circumstances, and needs of the Retirement Investor …"
PTE 2020-02, Section II(b)(1) -- Impartial Conduct Standards, Best Interest
What this means in plain English
Three practical obligations:
- Best-interest standard on every rollover recommendation. Not just the fiduciary duty owed under the Advisers Act — a separate ERISA-side best-interest obligation.
- Documented rollover analysis. The firm must be able to show why the rollover is in the Retirement Investor's best interest — including the alternative of leaving assets in the plan, the fee and expense difference, and the specific investment recommendation into the IRA.
- Written policies + retrospective review. The firm must maintain policies designed to mitigate conflicts and conduct an annual retrospective review of PTE 2020-02 compliance.
What triggers the exposure in the sample
The R3 client group in the sample is age 50-65 with the "401k_rollover" account type as a common feature. When an AI recommendation engine routes those clients to active-alpha / high-fee IRA lanes at 3x baseline frequency, every one of those rollover recommendations lives under PTE 2020-02's Impartial Conduct Standards. The firm bears the burden of showing the rollover was in the client's best interest — including versus the plan-stay alternative.
What the $499 Snapshot shows against this rule
- Documented per-client-group behavior of the AI on rollover-relevant client segments — the retrospective-review evidence
- Dated event log of the rollover-recommendation window under drift — the "when did the firm know" record
- 3 fix-first items including freeze/hold criteria for rollover recommendations to affected segments
- Signed independent-verifier declaration — addresses the "who was watching this" question for the ERISA venue
$499 Snapshot. 3 business days.
Dated independent record covering the AI recommendation surface where your rollover recommendations live.
Buy $499
Snapshot credit applies to Baseline ($2,500) or Enterprise Attestation ($35-55K) upgrade within 30 days.