Congresswomen put financial advice issues front and center
From fiduciary to elder fraud, female senators and representatives are addressing key concerns.
Since their early days in Congress, women have often defied prevailing gender stereotypes by focusing on issues once considered the domain of men.
The late Sen. Margaret Chase Smith, R-Maine, for example, concentrated on military affairs and foreign policy in the 1940s and 1950s. And the late Rep. Barbara Jordan, D-Texas, received the U.S. Military Academy’s top award for her service in Congress in the 1970s.
Women in Congress today are well-represented in the financial services legislative arena. If the world of finance was ever a male bastion in Congress, it no longer is today.
Nine women — six Democrats and three Republicans — serve on the 60-member House Financial Services Committee. The top Democrat on that committee, Rep. Maxine Waters of California, first elected to Congress in 1990, is an aggressive advocate for victims of abusive banking industry practices.
Although only three women serve on the 26-member Senate Finance Committee, two of the three — Sens. Debbie Stabenow, D-Mich., and Claire McCaskill, D-Mo., have been deemed by Congress-watcher CQ Roll Call to be among the “most influential women” in Congress.
A well-known member of the Senate Banking Committee, Sen. Elizabeth Warren, D-Mass., is also on that “most influential” list.
(More: Sen. Elizabeth Warren urges DOL to implement fiduciary rule without delay)
Twenty-one women currently serve in the U.S. Senate (16 Democrats and five Republicans), and 84 in the House of Representatives (62 Democrats and 22 Republicans).
Meanwhile, the top Democrat on the Senate Committee on Health, Education, Labor and Pensions is Sen. Patty Murray, D-Wash., who also serves on its subcommittee with jurisdiction over pensions.
Adviser bills
And legislation directly impacting financial advisers has been the purview of congresswomen.
Rep. Ann Wagner, R-Mo., introduced a bill in September that would kill the Labor Department’s fiduciary rule and instead require brokers to disclose the compensation they receive and any conflicts of interest, as laid out in a yet-to-be-crafted SEC regulation.
Ms. Wagner has been one of the most strident congressional critics of the DOL fiduciary rule, which would require brokers to act in the best interests of their clients in retirement accounts. Opponents say the rule is too complex and costly and would price investors with modest assets out of the advice market. Proponents say the DOL rule mitigates broker conflicts of interest that result in the sale of inappropriate high-fee products that erode savings.
On Capitol Hill, Sens. Susan Collins, R-Maine, and McCaskill, have reintroduced a bill that would give financial advisers civil liability protection for reporting senior financial abuse to state regulators and other government agencies.
Regulators are beefing up enforcement around elder financial abuse, and advisers would welcome the protections in the Collins-McCaskill bill.
Last year, the North American Securities Administrators Association issued a model rule requiring financial advisers to report suspected abuse to state and other authorities, allowing them to stop disbursements from seniors’ accounts and giving them protection from liability. And the Financial Industry Regulatory Authority Inc. is weighing an expansion of a rule to protect seniors from fraudulent disbursements from brokerage accounts, which goes into effect in February 2018, to include fraudulent transactions as well.
(More: More states likely to approve senior financial abuse regulations)
Whether or not women are more effective legislators than men has been a subject of academic scrutiny. A 2013 study published by the American Journal of Political Science found that a bigger determining factor than gender in effectiveness is whether women are in the majority or minority party.
“Contentious and partisan activities of male lawmakers may help them outperform women when in a polarized majority party,” wrote the team of researchers led by the University of Virginia’s Craig Volden. Yet the female members of the House who were members of the minority party “are better able to keep their sponsored bills alive through later stages of the legislative process than are minority party men.”
A more recent paper published in 2016 by the National Bureau of Economic Research found that women of both parties tend to find more co-sponsors for their proposed legislation than men, which in theory should increase the probability their proposals will be enacted.
Mark Schoeff Jr. contributed reporting to this story.
Richard F. Stolz is a freelance financial writer.
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