Wagner introduces bill to kill DOL fiduciary rule

Legislation would establish a different best interest standard that would require brokers to disclose the compensation they receive and any conflicts of interest that are linked to investment products they sell.
SEP 27, 2017

Rep. Ann Wagner, R-Mo., introduced a bill on Wednesday that would kill the Labor Department's fiduciary rule and establish a best-interests investment standard. The measure, first released in the form of a discussion draft in July, would require brokers to disclose the compensation they receive and any conflicts of interest that are linked to investment products they sell to clients in a regulation that would be written by the Securities and Exchange Commission. 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. "America is in the midst of a savings crisis, and this legislation will ensure it is easier for families to save and invest, not harder," Ms. Wagner said in a statement. "At the end of the day, every family should have access to affordable investment products and the confidence that their best interest is being served." An advocate for the DOL rule asserted that Ms. Wagner's bill is a weak alternative. "It's too bad that Ann Wagner thinks it's okay to mislead investors by putting out a sham bill that would not be in the their best interests," said Kate McBride, a founding member of the Committee of the Fiduciary Standard and owner of the consulting firm FiduciaryPath. "They're basically [introducing] a save-Wall-Street-commissions bill." The bill is one of several pieces of legislation by Republicans in the House and Senate designed to stop the DOL rule. The prospects for the legislation are uncertain because Democrats have remained united in opposing efforts to overturn the DOL rule, which was partially implemented in June. Any bill would have to overcome a potential Democratic filibuster in the Senate. There are no Democratic co-sponsors of Ms. Wagner's bill, which has not yet been scheduled for a vote in the House Financial Services Committee. The DOL has proposed delaying for 18 months —from Jan. 1, 2018, until June 1, 2019 — the enforcement mechanisms of the regulation as it conducts a review ordered by President Donald J. Trump that could result in revisions.

Latest News

Finra's Reg BI Enforcement: Is it 'ineffective, costly'?
Finra's Reg BI Enforcement: Is it 'ineffective, costly'?

The industry watchdog's own reports reflect failures to deter "willful" and "repeat" violations, raising a crucial question about the future of regulation.

SEC prepares to back away from defending climate rule in court
SEC prepares to back away from defending climate rule in court

Acting Chairman Mark Uyeda directed SEC staff to initiate a pause in court while the commission awaits a quorum. The SEC may decide to withdraw from defending itself in a lawsuit over last year's climate disclosure rule.

wealth.com welcomes Kathy Wunderli in private wealth push
wealth.com welcomes Kathy Wunderli in private wealth push

The top estate planning platform's veteran hire will lead its legal team's efforts to develop estate planning, tax analysis, and wealth transfer solutions for ultra-high-net-worth clients.

Morgan Stanley loses $843,000 investor claim stemming from 'gold bar' scam
Morgan Stanley loses $843,000 investor claim stemming from 'gold bar' scam

“If Morgan Stanley had called my client’s son, this wouldn’t have happened,” the investor's attorney said.

LPL welcomes $630M sibling advisor duo from Corebridge
LPL welcomes $630M sibling advisor duo from Corebridge

Meanwhile, Ameriprise has bolstered its own ranks as an LPL defector joins its branch channel in California.

SPONSORED Taylor Matthews on what's behind Farther's rapid growth

From 'no clients' to reshaping wealth management, Farther blends tech and trust to deliver family-office experience at scale.

SPONSORED Why wealth advisors should care about the future of federal tax policy

Blue Vault features expert strategies to harness for maximum client advantage.