DOL retirement security rule would be ‘disastrous,’ GOP rep says
Republican lawmakers bashed and Democrats praised a Department of Labor investment advice proposal Thursday at the second congressional hearing on the measure since the beginning of the year.
Democrats asserted the proposal would be “in the best interest” of American workers, while Republicans and industry opponents said it is “a solution in search of a problem.”
It could have a “disastrous impact on the industry,” said Rep. Bob Good, R-Va. and chair of the House Education and Workforce subcommittee that held the hearing.
“The last time the government tried to issue a similar rule, financial institutions were forced to eliminate or limit brokerage advice services as a result,” Good added. “A financial advisor in Virginia put it this way: The more layers of rules and regulations Congress and the White House add, the less likely it is that the average American will get the advice that they need. This rule will give too much latitude to the administrative state to go after anyone in the retirement business and will cause lawsuits to skyrocket.”
Good said the DOL has overstepped its authority on the issue.
“DOL’s expansive rule [is] a blatant power grab seeking to force more types of financial professionals under their control but other regulatory bodies at the federal and state level already exercise oversight over the retirement products and services that DOL is trying to bring within its jurisdiction,” he added.
Rep. Mark DeSaulnier, D-Calif. and ranking member on the subcommittee, countered that an advice rule is needed because the primary DOL regulation, which dates to 1975, is riddled with loopholes, and “bad actors can get away with providing conflicted advice.”
“The Biden administration has proposed a common sense,
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