A cohort of lawmakers in the House of Representatives, including two Democrats, has penned a letter to Labor Secretary Thomas Perez, calling on him to scrap the existing proposed fiduciary rule and re-propose a new regulation that accounts for stakeholders’ concerns.
Rep. Ann Wagner, R- Missouri, who introduced the Retail Investor Protection Act in 2013, a law that would require the Securities and Exchange Commission to take the lead in writing a new fiduciary standard and that passed the House before stalling in the Senate, was the lead signatory to this most recent letter.
She was joined by 17 other Republicans and two Democrats, William Clay, D-Missouri and David Scott, D-Georgia.
Rep. Clay, a member of Congressional Black Caucus, serves the 1st District of Missouri, which abuts Rep. Wagner’s district. The two districts encompass a large swath of the greater St. Louis metro region, home to Edward Jones, Stifel Financial, Wells Fargo Advisors, and Scottrade—brokerages with large stakes in the debate over the wisdom of the DOL’s proposed rule.
The letter represents a new strategy by opponents of the DOL’s rule-making process.
It does not call for the SEC to take the lead in writing a new uniform fiduciary standard for the broker-dealer industry, as the Retail Investor Protection Act did.
Nor does the letter expressly challenge the DOL’s jurisdiction over the IRA market, which would be fundamentally transformed by the rule, say both opponents and proponents of the DOL’s rule.
But it does suggest that the vast range of comments in opposition to the rule could mean the DOL will end up finalizing a regulation fundamentally different from its proposal, and that in effect would require further review from industry stakeholders.