House Bill Aims at Two Year Delay of DOL Rule
A new bill introduced in Congress could delay the implementation of the Department of Labor’s fiduciary rule and give Republican opponents time to alter or kill it entirely, the Wall Street Journal writes.
The rule, scheduled to go into effect in April, requires retirement brokers to put clients’ interests ahead of their own. But the bill introduced last week by Joe Wilson, R-S.C., would delay its implementation by two years, according to the Journal. Unlike previous Republican attempts to derail the rule that failed to move from the House to the Senate because of Democratic opposition, Wilson’s bill “has legs,” Barbara Roper, director of investor protection at the Consumer Federation of America, tells the Journal. But Erin Sweeny, an attorney at Miller & Chevalier Chartered who represents clients in fiduciary cases, tells the paper that Senate Democrats would meet the bill with a filibuster that Republicans still don’t have enough votes to overrule.
Last week, Labor Secretary Thomas Perez called on President-elect Donald Trump’s administration to implement the rule and to adequately fund the DOL’s enforcement arm.
Lack of enforcement could water down the rule but wouldn’t achieve as much as a repeal, Roper said last week.
Meanwhile, a Republican Congressman opposed to the DOL’s fiduciary rule has been chosen to oversee the SEC as chair of the Financial Services Committee’s Capital Markets Subcommittee, Financial Advisor magazine writes. Bill Huizenga, R-Mich., cosigned a letter to DOL’s Perez in 2015 arguing that the rule would cut investor choices in retirement saving, the publication writes.
The DOL rule still faces several other challenges, including lawsuits from numerous industry groups and a call by an influential coalition of conservative Republicans for a repeal.
Trump hasn’t addressed the rule specifically, although one of his campaign advisors who’s currently a member of the transition team has called repeatedly for the rule’s repeal. Andy Puzder, Trump’s nominee to replace Perez to head the DOL, is seen as hostile to President Barack Obama-era financial regulations. But Puzder also hasn’t addressed the rule specifically.