NTU urges all Representatives to vote “YES” on the veto override of H.J. Res. 88, a resolution of disapproval for the Department of Labor’s (DOL’s) fiduciary rule. This resolution, which originally passed the House of Representatives by a wide margin, would kill DOL’s ill-considered fiduciary rule for financial advisors that will raise costs and limit access to financial advice.
In early April, DOL released its final version of the so-called “fiduciary rule.” Coming in at over 1,000 pages and estimated to cost nearly $32 billion over ten years (according to DOL’s conservative estimates), the rule will increase regulations and compliance burdens for financial advisors, open the door to costly litigation, and possibly price low and moderate income people out of the investment market, a vital source of retirement income for many.
Under the rule, financial advisors and securities brokers must adhere to a fiduciary standard when dealing with clients. This is a heightened legal standard; currently, such advisors and brokers are held to a suitability standard. In other words, these professionals must ensure that the product sold to the investor is suitable for the investor’s needs. By raising the duty of care, coupled with adding complex and confusing requirements on advisors, DOL’s rule will increase compliance costs, restrict consumer choice and ultimately harm those most in need of financial planning and advice.
Even though they have received repeated warnings during hearings and in the comment period that the draft rule was unworkable, DOL’s final version did little to assuage these concerns. Despite the President’s veto of H.J. Res. 88, it’s important that Congress vote to override the veto as an important step in overturning this burdensome rule.
Roll call votes on the veto override of H.J. Res. 88 will be included in our annual Rating of Congress and a “YES” vote will be considered the pro-taxpayer position.
If you have any questions, please contact NTU Counsel and Government Affairs Manager Clark Packard at (703) 299-8680