Acosta: DOL Rule Concerns ‘Not Heard’ by Obama Appointees

By John Hilton

Secretary of Labor Alexander Acosta told a House subcommittee today that legitimate concerns about the DOL fiduciary rule were waved off by the Obama administration.

Acosta made his first full extensive remarks on the controversial DOL rule during an appearance before the House Subcommittee on Labor, Health and Human Services, Education, and Related Agencies this morning.

The Obama administration raced the clock in a two-year process to get the fiduciary rule on the books before his time in office ended. Extensive public hearings and comment periods generated a flood of concerns from the industry.

The DOL continues to receive resistance from industry officials who say the rule will cut off Americans' access to financial advice.

"The prior administration made a decision that those concerns were outweighed by what the prior administration wanted to do," Acosta said.

The DOL rule is slated to begin taking effect Friday. Acosta previously announced that he will not order a halt to that deadline. However, more punitive requirements are set to kick in on Jan. 1, 2018.

The department is conducting a review of the rule as ordered by President Donald J. Trump in a Feb. 3 memorandum. If the review finds justification, those more onerous requirements could be amended or scrapped. Also, the Jan. 1 deadline could be delayed further.

The Office of Management and Budget received a Request For Information from the DOL Tuesday, sources say. The RFI seeks information from industry players and is the first step in the DOL review, Acosta said.

The DOL rule establishes a fiduciary standard for anyone working with retirement dollars. The DOL under Obama claimed commission-based "conflicted advice" costs investors $17 billion annually, a figure widely disputed within the industry.

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].

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]. Follow him on Twitter @INNJohnH.