A group of Republican U.S. Senators introduced a resolution Monday to overturn the Department of Labor’s fiduciary rule.
Sens. Mike Enzi and John Barrasso, R-Wyo., joined Sens. Johnny Isakson, R-Ga., and Lamar Alexander, R-Tenn., in introducing the resolution to block what they termed a “harmful new regulation that will have devastating effects on retirement planning by hardworking families and small businesses.”
Isakson, Alexander and Enzi today filed a resolution of disapproval under the Congressional Review Act to reject this decision that has been labeled "Obamacare for retirement planning."
If approved, the resolution of disapproval would allow Congress to stop the Department of Labor from implementing the rule, which opponents say will deny retirement advice to low- and middle-income savers.
The effort is largely seen as symbolic by analysts since President Obama must sign any resolution for it to take effect.
The DOL proposed new fiduciary rules in April 2015, which cover advice provided regarding qualified retirement employer-sponsored plans and individual retirement accounts.
DOL officials and public interest groups say the rules, which impose a fiduciary standard of care on financial advisors dealing with retirement accounts, are necessary to protect retirement investors from high commissions.
Critics say the DOL is trying to force the industry to move from a commission- to a fee-based model. The rule allows for commissions via a prohibited transaction exemption, but industry officials said it isn’t realistic due to the burdensome regulations.
Under the Congressional Review Act, the House and Senate vote on a joint resolution of disapproval to stop, with the full force of law, a federal agency from implementing a rule or regulation or issuing a substantially similar regulation without congressional authorization.
A resolution of disapproval only needs a simple majority to pass and cannot be filibustered or amended, if acted upon during a 60-day window. The resolution of disapproval must also be signed by the president or Congress can overturn a veto with a two-thirds vote in both the Senate and the House.
Isakson is the lead sponsor of the resolution of disapproval, which, in addition to Alexander and Enzi, is being co-sponsored by U.S. Sens. John Barrasso, R-Wyo., Kelly Ayotte, R-N.H., Roy Blunt, R-Mo., John Boozman, R-Ark., Shelley Moore Capito, R-W.Va., Bill Cassidy, R-La., Daniel Coats, R-Ind., Thad Cochran, R-Miss., Mike Crapo, R-Idaho, Steve Daines, R-Mont., Joni Ernst, R-Iowa, Deb Fischer, R-Neb., Orrin Hatch, R-Utah, James Inhofe, R-Okla., Ron Johnson, R-Wis., Mark Kirk, R-Ill., James Lankford, R-Okla., Mike Lee, R-Utah, Mitch McConnell, R-Ky., Jerry Moran, R-Kan., Lisa Murkowski, R-Alaska, Rand Paul, R-Ky., David Perdue, R-Ga. Pat Roberts, R-Kan., Marco Rubio, R-Fla., John Thune, R-S.D., Thom Tillis, R-N.C., David Vitter, R-La., and Roger Wicker, R-Miss.
InsuranceNewsNet Senior Editor John Hilton has covered business and other beats in more than 20 years of daily journalism. John may be reached at [email protected].
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