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

Five-person Raymond James team jumps to Janney in Maryland
Five-person Raymond James team jumps to Janney in Maryland

The group led by a 37-year industry veteran brings $470 million in assets to the Philadelphia-based broker dealer.

$20B Merit looks to next phase as Constellation takes minority stake
$20B Merit looks to next phase as Constellation takes minority stake

The Atlanta, Georgia-based national wealth firm revealed its new PE partner as prior backers Wealth Partners Capital Group and HGGC’s Aspire Holdings exited their investments.

$350M father-son duo hops from Osaic to Equitable Advisors
$350M father-son duo hops from Osaic to Equitable Advisors

The latest departures in Ohio mark another setback for the hybrid RIA, which is looking to "expanding its presence across all models and segments of the wealth management industry.”

Fresh off HPS acquisition, BlackRock inks deal for $7.3B ElmTree Funds
Fresh off HPS acquisition, BlackRock inks deal for $7.3B ElmTree Funds

The St. Louis-based real estate investment firm gives the asset management giant a valuable access point to the roughly $1 trillion net lease market.

SEC charges Chicago-based investment adviser with overbilling clients more than $2.5M in fees
SEC charges Chicago-based investment adviser with overbilling clients more than $2.5M in fees

Eliseo Prisno, a former Merrill advisor, allegedly collected unapproved fees from Filipino clients by secretly accessing their accounts at two separate brokerages.

SPONSORED How advisors can build for high-net-worth complexity

Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.

SPONSORED RILAs bring stability, growth during volatile markets

Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.