Senate votes to block fiduciary rule enforcement
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Following the lead of the House of Representatives, the Senate approved legislation to block enforcement of final U.S. Labor Department pension plan fiduciary rules on a largely party-line 56-41 vote Tuesday.
The House first approved the measure, H.J. Res. 88, also on a largely party line 234-188 vote in late April.
Under those rules, released in early April, retirement plan advisers could be at risk of civil penalties if they fail to consider customers’ best interests, while employers could be at risk should they or their advisers offer suggestions on investments in the plans they sponsor.
The final rule, which is scheduled to go into effect in about a year, replaces outdated rules that “did not ensure that financial advisors act in their clients’ best interest when giving retirement investment advice,” the White House said earlier.
However, Senate Majority Leader Mitch McConnell, R-Ky., warned of the negative consequences if the rules are allowed to go into effect.
“Some have estimated that investment fees could more than double under this regulation. What this means is that many consumers could risk losing access to quality, low-cost retirement advice, and many financial advisors may not be able to offer sound financial products that provide peace of mind to their clients,” Sen. McConnell said in a statement prior to the Senate vote.
The White House earlier said President Barack Obama will veto the measure blocking the rules change.
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House OKs bill blocking Labor Department pension fiduciary rules
The House of Representatives Thursday approved legislation to block enforcement of final Labor Department pension plan fiduciary rules.
