The Financial Services Institute (FSI) and Financial Services Roundtable on Tuesday called for Department of Labor (DOL) Secretary Hilda Solis to release a progress report on its work to re-propose a fiduciary rule for the financial services industry.
Both groups also are asking the report demonstrate how DOL is following the criteria outlined by a bi-partisan Congressional request.
FSI says that more than 50 House Republicans and 30 House Democrats last year sent DOL two separate letters regarding its attempts to redefine the term "fiduciary." FSI claims that those letters directed DOL to "follow a set of criteria while writing their new rule -- a rule that threatens to price Main Street Americans out of financial advice on their IRAs leaving only the wealthy with access to advice."
FSI President and CEO Dale Brown said that FSI has called on DOL to "withdraw and re-propose," not "withdraw and walk away" in redefining a fiduciary standard and requested the DOL to update the public as soon as possible on its progress.
"We look forward to the department sharing their evidence of problems prompting this pending rule, hopefully dispelling the conventional wisdom that it's a solution in search of a problem," Brown said. "We fully expected and urged DOL to come back with a more appropriate rule based off a true picture of the problem they're trying to solve. Yet, we still have no idea what the problem is, while we're told they are working on a solution."
In response to FSI's statements, Office of Public Affairs spokesman Michael Trupo says DOL is on the right track in making progress in redefining the financial service industry's definition of "fiduciary."
"The problem we are addressing in the re-proposal has been clear since this process began -- to help retirement plans and IRA owners get good, reliable investment advice -- advice that puts their interests first," Trupo says. "Our re-proposal, when complete, will provide ample opportunity for public comment, both on the proposed rule itself and on our assessment of its likely effects. We are making good progress as we make every effort to get this right."
-Jim McConville