House Passes Bill to Delay DOL Overreach

Last week, thirty Democrats in the U.S. House of Representative joined Republicans to approve the Retail Investor Protection Act, which delays the Department of Labor’s rule amending the definition of “fiduciary.”

The bill, sponsored by Ann Wagner, a Missouri Republican, would block the Labor Department from finalizing a more stringent fiduciary standard on investment advisors to workplace retirement plans until 60 days after the Securities Exchange Commission implements its own fiduciary standard on investment advisors and stock brokers. Additionally, the bill requires the SEC to conduct analysis on whether an increased fiduciary standards would amount in less access to investment options and advice for retail investors.

Financial industry experts concern with the DOL rule is that it could severely increase costs and reduce investor choice for people hoping to invest in 401k plans or Individual Retirement Accounts. Further, the SEC’s mission is to protect investors not the DOL. If any agency is going to regulate the financial industry it should be the SEC.

After the bill passage Rep. Wagner commented, “This legislation will preserve and increase lower and middle income Americans’ access to affordable investments. It will also ensure that retail investors – families and individuals around the country – are not harmed by misguided regulations coming out of Washington. Today’s vote is an important step in that direction, and I look forward to working with my colleagues on both sides of the aisle to advance this legislation in the Senate.”

To see how your Representative voted, see WPC Congressional Scorecard here (Roll Call 567). For more on the DOL’s fiduciary rule, see here, here and here.