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December 05, 2011 at 10:14 AM
Fifty-five House Republicans today joined 30 House Democrats in requesting that the Department of Labor significantly narrow its definition of “fiduciary” in a rule the agency is currently drafting that would impact the sale of retirement products.
House Democrats sent a letter to DOL secretary Hilda Solis on Nov. 8—after the agency decided under intense industry and congressional pressure to withdraw the proposed rule.
The proposal was withdrawn in late September by Phyllis Borzi, director of the DOL’s Employee Benefits Security Administration.
Borzi and Solis have said the rule would be re-proposed in January and would keep in mind the concerns of interested parties.
Today, House Republicans sent a letter of their own to the DOL, mainly repeating the Democrats’ points, asking that the DOL, if it decides to re-propose the rule, “recognize the broad range of financial products currently available.”
However, the letter asks that in a re-proposed rule the DOL “avoid costly new regulations that may reduce choice among qualified service providers and investment products.”
Borzi has made clear that IRAs would still be subject to the fiduciary standard in any revised rule. She has noted repeatedly that federal retirement laws must be updated to protect workers and retirees who are now responsible for their own nest eggs through defined-contribution plans such as 401(k)s and IRAs.
