Supporters of the Department of Labor’s fiduciary proposal struck back today in the face of mounting Republican opposition to the changes.
Responding to legislation approved by the House Financial Services Committee to halt the DoL's proposed rule changes, the Consumer Federation of America said the largely partisan vote would halt efforts to protect investors.
"Certainly it is disappointing that a majority of Committee members voted in favor of a bill that would call a halt to regulatory efforts to ensure that all retirement savers get advice that serves their best interests," said Barbara Roper, director of Investor Protection at the consumer group, in a statement. "Certainly it is disappointing that a majority of Committee members voted in favor of a bill that would call a halt to regulatory efforts to ensure that all retirement savers get advice that serves their best interests. And the pretense that this is being done to protect retail investors is particularly galling.
“Working families and retirees who turn to financial professionals for help with their retirement investments deserve advice that is in their best interests," Roper continued. "The Department of Labor has offered a strong and effective rule to achieve that goal. We urge Congress to reject this and similar efforts to prevent them from finalizing a rule.”
The Financial Planning Coalition also came out against H.R. 1090, the “Retail Investor Protection Act,” the legislation to block the DoL proposals.
"The need for a strengthened fiduciary rule under the Employee Retirement Income Security Act (ERISA) is long overdue," the Coalition, comprised of the CFP Board, the FPA and NAPFA, said in a statement. "As H.R. 1090 heads to the House floor, we urge Congress not to intervene – through this bill or any other vehicle – and to let the DoL do its job and protect retirement investors."
In a letter to members of the House Financial Services Committee, the Coalition said H.R. 1090 "does not protect retail investors. Rather, it inappropriately prohibits the DoL from adopting a rule to protect America’s retirement investors until after the Securities and Exchange Commission (SEC) issues a fiduciary rule"
The tactic, according to the coalition, "would indefinitely delay or completely block adoption of a DoL fiduciary rule because the SEC is not required to issue a fiduciary rule, has yet to propose a rule – almost five years since Congress authorized it to do so – and may never do so."
Despite the passage of the Republican bill in the House, however, odds of legislation to block the DoL's proposed fiduciary rule changes remain slim due to strong Democratic opposition.
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