Labor Secretary Alexander Acosta wants to freeze the fiduciary rule in a way that will “stick,” according to an email a Senate aide sent to rule opponents on Tuesday.
Acosta told Sen. Tim Scott, R-S.C., that the rule is his No. 1 priority and that he recognized the urgency of the situation, according to an email from Scott’s aide. Acosta has not spoken publicly about the rule since his confirmation hearing in March.
The regulation had been delayed until June 9, at which point annuities sold with retirement money would fall under a fiduciary standard. Fixed indexed and variable annuities would be subject to the more rigorous Best Interest Contract Exemption and non-indexed annuities would come under the Prohibited Transaction Exemption (PTE) 84-24.
Rule opponents argue that the rule would needlessly burden advisors, who would be less likely to work with consumers’ retirement funds. Rule proponents say that is precisely the object.
Scott was one of 124 lawmakers who signed a letter sent last week demanding that Acosta and the Department of Labor reform the rule.
The letter is one of a few ways opponents are going after the rule before its June 9 applicability date. The House of Representatives is expected to pass a bill that would undo many of the Dodd-Frank financial reforms. The legislation includes a provision that would postpone the DOL rule until the Securities and Exchange Commission acts on a uniform fiduciary standard. The entire legislation faces long odds of passing the Senate.
Steven A. Morelli is editor-in-chief for InsuranceNewsNet. He has more than 25 years of experience as a reporter and editor for newspapers, magazines and insurance periodicals. He was also vice president of communications for an insurance agents’ association. Steve can be reached at [email protected]