Senate Democrats were successful on Thursday, May 20, in invoking cloture on Senator Christopher Dodd’s (D-Connecticut) financial services reform bill, S. 3217.
Further debate on current amendments is now limited to 30 hours and a halt will be placed on the introduction of new amendments. Washington observers are confident that the Senate will move to a final vote soon.
The first attempt at invoking cloture on May 19 failed, with a vote of 57-42. Senate Democrats garnered the 60 votes that were needed on Thursday to move the bill forward. Three Republicans joined the Democratic majority in favor of ending the debate. Two Democrats voted with 38 Republicans in opposition to finalizing the bill. In an odd twist, freshman Senator Scott Brown (R-Massachusetts) provided the decisive vote for the Democrats.
After the vote was called, Senate Majority Leader Harry Reid (D-Nevada) said, “It’s been hard to get to this point. But it was a good debate.”
None of the amendments involving fiduciary duty have been debated on the Senate floor. Washington observers say that it is possible that fiduciary amendments could be added to the manager’s amendment, which is being crafted by Dodd and Senator Richard Shelby of Alabama, ranking GOP member on the Senate Banking Committee.
The American Association of Retired Persons (AARP) joined May 19 the North American Securities Administrators Association (NASAA) and the Consumer Federation of America (CFA) in opposing the Harkin/Johanns/Leahy amendment (S 3920) to Dodd’s bill, which the groups say would deprive investors in indexed annuities of the strong protections afforded by our nation’s securities laws. The amendment, the groups say, “seeks to reverse the SEC’s Rule 151A, which would subject indexed annuities to regulation as securities. Adopted by the SEC in 2008, the rule was later challenged by the insurance lobby. Although the U.S. Court of Appeals for the District of Columbia Circuit upheld the legal foundation for Rule 151A, the SEC has agreed to delay the rule’s effective date to 2013.”