President Donald Trump shows a signed executive order in the Oval Office on February 3. REUTERS/Kevin Lamarque President Donald Trump has signed an executive order on the Obama administration's landmark retirement savings rule, setting in motion a potential repeal of a recently passed standard that would have made it harder for financial advisers to give conflicted advice.

The so-called fiduciary rule, which is slated to go into effect in April and will likely now be delayed, requires advisers to put their clients' interests ahead of theirs. The rule has long drawn rebuke from Wall Streeters and some of those who are close to Trump.

"The rule is a solution in search of a problem," White House press secretary Sean Spicer said Friday in a televised news conference.

"We're directing the Department of Labor to review this rule," Spicer added, saying that the department, which passed the rule, had "exceeded its authority" and represented a type of government overreach the president intended to stop.

Trump signed the executive order around 1:30 p.m. Eastern on Friday. (You can read a full copy of the order here.)

Earlier on Friday, White House National Economic Council Director Gary Cohn told CNBC in a TV interview that the fiduciary rule limited customers' choices in financial products.

"I don't think you protect investors by limiting choices," said Cohn, who previously was Goldman Sachs' COO.

"We think it is a bad rule. It is a bad rule for consumers," Cohn told The Wall Street Journal. "This is like putting only healthy food on the menu, because unhealthy food tastes good but you still shouldn't eat it because you might die younger."

Those who supported the rule have come out against Trump's move.

Massachusetts Sen. Elizabeth Warren took aim at the executive order, saying it would "make it easier for investment advisers to cheat you out of your retirement savings."

Nancy LeaMond, executive vice president at AARP, a nonprofit representing retirees with nearly 38 million members, said in a statement, "For many Americans, today's executive order means they will continue to get conflicted financial advice that costs more and reduces what they are able to save for retirement."

What's the fiduciary rule?

It's a simple enough concept: A financial adviser should be legally required to put their clients' best interests ahead of their own.

But it's actually not the law. The Department of Labor — which concerns itself with such matters because of its oversight of workers' welfare and retirement — decided last year to change that by establishing the fiduciary rule over retirement accounts. That drew rebukes from Wall Street lobbyists and one of Trump's most flamboyant backers, financier Anthony Scaramucci.

Former President Barack Obama speaking during his last press conference at the White House. REUTERS/Joshua Roberts The fiduciary rule was set to take effect in April 2017. Its specific requirement is that financial advisers — who can be paid referral fees by asset managers for directing client money into their funds — must put their clients' interests ahead of theirs.

Currently, brokers, financial advisers, and other finance professionals don't legally have to act in a client's best interest, with few exceptions, such as those who are registered as investment advisers with the Securities and Exchange Commission or in individual states. Those who are registered in this way often advertise it — it's seen as good business.

Those who aren't registered, like brokers, just have to prove that the investment is suitable, not necessarily the best option, for their client — no matter that that fund might be more expensive and provide a better commission for the adviser.

"It's kind of like if you let doctors be part of the drug companies directly and prescribe their own medicine," Blaine Aikin, executive chairman of fi360, a fiduciary consultancy in Pittsburgh, told Business Insider last year. "Unfortunately, we have a system where we've not established clarity between the sales side of financial services and the profession of financial advice."

A summary of the kinds of conflicted payments advisers can receive, according to an Obama White House report. Obama administration The conflicts of interest inherent in using advisers who aren't serving in clients' best interests may go unnoticed by those who use them and are unaware they are signing into a conflicted relationship.

Conflicted advice costs retirement savers about $17 billion a year, according to a 2015 report from the Obama administration. Despite objections, the administration pushed ahead with a rule change in April 2016, giving fund managers a year to figure out how they would comply.

Advisers could still receive commissions under the new rule, but they have to provide a contract promising to put a client's interests first — the "best-interest contract exemption" — and receive no more than reasonable compensation. Firms would also have to clearly disclose all their compensation and incentive arrangements.

Wall Street firms worried about this exemption because it opens them up to litigation if their clients believe their advisers have not acted in their best interest. "Retirement investors will have a way to hold them accountable," the Labor Department says.

To be clear, this rule applies only to retirement accounts like 401(k)s and individual retirement accounts, not to regular taxable accounts, with which advisers can rely on the weaker suitability standard. Still, there's big money at stake. Americans invest $7 trillion in 401(k)s and $7.8 trillion in IRAs, according to the industry's lobby group, ICI.

Wall Street's rebuke

Anthony Scaramucci. Hollis Johnson When it was first raised, the rule prompted rebuttals from the financial industry. Some argued that they would face increased compliance costs and that those costs would price out smaller brokers who wouldn't be able to service smaller accounts.

Scaramucci, now one of Trump's advisers, has been one of the rule's most vocal critics. He also had a lot at stake. SkyBridge Capital, a fund-of-hedge-funds he founded and recently sold, would likely have been hurt by the rule since the firm oversees retirement money, and gets a bulk of its assets via financial advisers at banks.

The fiduciary rule could put this very model of using a bank's army of financial advisers as a sales force for hedge funds at risk, especially at funds-of-funds that often end up in retirement accounts, industry lawyers previously told Business Insider.

Wall Street firms have also been fearful of another secondary effect that would hit them where they are already hurting. The rule was expected to accelerate a shift toward passively managed funds, like exchange-traded and index funds, because it's easier to prove that such products, which are much cheaper, are in a retirement saver's best interest. That has already been a big issue for Wall Street, as index funds have eaten into the share of actively managed funds.

The fiduciary rule may live on anyway

For all the concerns about what Trump could do to the rule, it might be too late for him to do much to undercut the change. That's because Wall Street firms have already made the move to comply with the new standard, creating an industry shift unlikely to bend, experts say.

"Pragmatically, it's very difficult to step back from a rule that's so obviously needed," Jack Bogle, founder of the index provider Vanguard Group, which is known for its low-cost offerings and is likely to benefit from the change, previously told Business Insider.

For more background on the fiduciary rule and what's at stake, read Business Insider's explainer.