In a confirmation hearing before the Senate Health, Education, Labor and Pensions Committee on Wednesday, Secretary of Labor nominee R. Alexander Acosta said if confirmed he would support President Donald J. Trump's directions to review the fiduciary rule, which is slated to take effect April 10.
The Department of Labor announced on March 1 that it wants to extend the effective date of its fiduciary rule by 60 days and that it will be taking public comments on Mr. Trump's Feb. 3 executive memorandum, directing it to examine the fiduciary rule to determine whether it is likely to harm investors, disrupt the industry or cause an increase in litigation.
Asked by Sen. Elizabeth Warren, D-Mass., during Wednesday's hearing whether he supports the proposed rule or would stop a delay, Mr. Acosta said: "There is an executive action that directs how the Department of Labor will approach this rule. If I am confirmed as secretary of labor, I believe and support my following executive orders of the president who would be my boss."
Accusing Mr. Acosta of dodging her question, Ms. Warren went on to state: "If you can't give me straight answers on your views on this, not hide behind an executive order ... then I don't have any confidence you're the right person for this job."
Disagreeing with Ms. Warren, committee chairman Sen. Lamar Alexander, R-Tenn., told Mr. Acosta: "I think it's thoroughly reasonable for you to review a regulation according to the president of the United States ... after you're secretary of labor."
In the Feb. 3 memo, Mr. Trump also called for a new economic and legal analysis of the rule's "likely impact," and ordered the DOL to publish a proposed rule rescinding or revising the fiduciary regulation if the department's review finds the proposed rule will have a negative impact or is "inconsistent with administrative policy."
Mr. Acosta is dean of Florida International University College of Law and chairman of the board of U.S. Century Bank in Doral, Fla. A committee vote could take place next week.
Meaghan Kilroy is a reporter with InvestmentNews sister publication Pensions & Investments.