DOL Chief Defends Fiduciary Rule Process
By Arthur D. Postal
InsuranceNewsNet
WASHINGTON – Department of Labor Secretary Thomas E. Perez rejected claims that the Department of Labor is keeping the Securities and Exchange Commission (SEC) in the dark regarding its plans for a new fiduciary standard rule, he said in his first public comments on the issue.
“We are working very closely with the SEC,” Perez said on CNBC’s Squawk Box. Perez said he met a number of times with SEC Chairman Mary Jo White and that the DOL staff has been working closely throughout the process with the SEC. His comments confirmed remarks made last month in a conference call by Phyllis Borzi, assistant DOL secretary and head of the Employee Benefits Security Administration, the DOL agency dealing with the fiduciary proposal.
Moreover, Perez said, “I have personally participated in meetings with industry and consumer stakeholders” on the proposal.”
Perez’s comments foreshadowed what he will present to congressional committees demanding that the DOL present them evidence by later this month on their discussions with the SEC on the issue.
Perez cited Jack Bogle, the former CEO of Vanguard, and a strong advocate for heightened consumer education on financial issues. Bogle “has been in the business for 60 years, and he says, ‘when you put your customers first, that is good for business’.”
Perez explained that, “Lawyers and doctors have an obligation to look out for their patients and clients, and all we are in saying is, in the financial context, that advisor ought to do the same, and can do it.”
Perez added that, “so many financial advisors are in fact already doing it and we are going to create a level playing field for them. That is what our proposal will have.”
The Senate Special Committee on Aging will hold a hearing on Bridging the Gap: How Prepared are Americans for Retirement?, Thursday, and although no industry officials are scheduled to testify, members of the committee are seen as likely to discuss the controversial issue during the course of the hearing.
InsuranceNewsNet Washington Bureau Chief Arthur D. Postal has covered regulatory and legislative issues for more than 30 years. He can be reached at [email protected].
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