Fiduciary Rule Foe Eugene Scalia Confirmed As Secretary Of Labor

Staff Reports

Eugene Scalia, who brought a high-profile lawsuit against the Department of Labor fiduciary rule, was confirmed today as the 28th Secretary of Labor.

A 56-year-old partner at the law firm Gibson, Dunn & Crutcher, Scalia is the son of the late Supreme Court Justice Antonin Scalia. The Senate confirmed Scalia in a 53-44 vote, a potentially controversial nomination that sailed through amid Beltway preoccupation with impeachment debate.

As the Wall Street Journal noted, Scalia "built a practice over the past decade challenging Obama-era regulations on the grounds that policy makers failed to thoroughly review the costs and benefits of a postcrisis overhaul restricting Wall Street activities."

One of his targets was the DOL fiduciary rule. Representing the U.S. Chamber of Commerce, Scalia played a major role in convincing an appeals court judicial panel to vacate the Obama Labor Department's fiduciary rule. The requires agents to consider only the best interests of the client, as opposed to commissions or fees, when providing retirement advice.

The DOL is working on a new rule, which is expected to be more industry friendly and consistent with the Securities and Exchange Commission's Regulation Best Interest rule.

Ethics' experts have said they expect Scalia to recuse himself from that effort, which is said to be nearing completion.

“IRI congratulates Secretary Scalia upon his Senate confirmation vote today," said Insured Retirement Institute President and CEO Wayne Chopus. "We look forward to working with him and the U.S. Department of Labor to ensure a strong and vibrant retirement security system for millions of American workers so that they can enjoy a financially secure and dignified retirement.”

Scalia will be returning to the department where he previously served as solicitor in President George W. Bush's administration, overseeing litigation and legal advice on rulemakings and administrative law. He has also worked for the U.S. Department of Justice. From 1992-93, Scalia served as a special assistant to Attorney General William Barr during his first stint as attorney general.

Trump's previous secretary, Alexander Acosta, resigned amid renewed criticism of his handling of a 2008 secret plea deal with wealthy financier Jeffrey Epstein. The financier was indicted on charges of sexually abusing underage girls and pleaded not guilty before committing suicide in a Manhattan jail.

This report compiled by InsuranceNewsNet staff.