A new bill, the Financial Freedom Act of 2002, would prohibit the Labor secretary from constraining the range or type of investments that may be offered to participants and beneficiaries of retirement accounts.
The bill targets individual accounts in retirement plans like 401(k)s that are regulated under the Employee Retirement Income Security Act.
The GOP-backed bill, H.R. 7860, introduced by Rep. Byron Donalds, R-Fla., is likely a reaction by lawmakers to the Labor Department’s recent scrutiny of cryptocurrency investments in 401(k) plans, industry officials say.
“Among allowable investments, lawmakers want to give fiduciaries more leeway” without guidance from Labor, Ed Slott of Ed Slott & Co., told ThinkAdvisor in an interview.
Saying Labor “can’t constrain the type of investments,” Slott continued, “may be a response to the DOL pronouncement against crypto.”