Phyllis Borzi, head of the Department of Labor’s Employee Benefits Security Administration (EBSA), fought back on Tuesday against criticisms EBSA has received regarding its controversial regulation amending the definition of fiduciary under the Employee Retirement Income Security Act (ERISA).
At the Insured Retirement Institute’s (IRI) regulatory conference in Washington, Borzi (left) provided clarity on three areas that she said have drawn significant criticism under the proposed regulation: IRAs, broker commissions and EBSA’s collaboration with other agencies, like the Securities and Exchange Commission (SEC).
Brad Campbell, former head of EBSA, who’s now counsel with the law firm Schiff Hardin in Washington, is just one industry official that is critical of applying the fiduciary rule to IRAs. In a recent interview with AdvisorOne, Campbell said that “No where in the [proposed rule’s] economic analysis does it mention the impact the [fiduciary] rule would have on the IRA marketplace—[which holds] over $4 trillion of capital.”
Campbell went on say that given the fundamental difference between IRAs and 401(k)s, there is a valid question in: “Is DOL the right entity to regulate that [IRA] activity, or should this policy really be coming out of Treasury or the SEC?”