Congressman Hopes DOL Not ‘Paying Lip Service’ In Fiduciary Issue

By Arthur D. Postal
InsuranceNewsNet

WASHINGTON – Republican members of a House committee are requesting information about initiatives to revise the current standards of care in the sale of investment products

Reps. John Kline, R-Minn., and Phil Roe, R-Tenn., sent a letter to the Secretary of Labor, asking for copies of communications related to the Labor Department’s consultation with the Securities and Exchange Commission (SEC) on redefining the current fiduciary standard.

They said that no Department of Labor (DOL) rule seeking to revise the current standard of care should be issued until after Congress is satisfied sufficient coordination has occurred.

The Obama administration has just given the go-ahead for the DOL to start the clock running on the revised proposal to update the current standard of care used in selling investment products into retirement accounts since the Employee Retirement Income Security Act (ERISA) was enacted in 1974. DOL is doing so by forwarding its revised proposal to the Office of Management and Budget (OMB) to review. OMB has 60 working days to do so.

Kline is chairman of the House Education and the Workforce Committee, and Roe chairman of its Health, Employment, Labor, and Pensions Subcommittee.

“This rulemaking will affect the retirement security of millions of Americans, and I hope the department has done more than simply pay lip service to good government on this very important issue,” Kline said.

Kline added that, “It is clear coordination between SEC and DOL is vital to ensure a functioning regulatory framework; it is unfortunately far less clear that such coordination is occurring.”

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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