January 11, 2016
Statement of Opposition to Roe and Roskam Bills
AFL-CIO, Americans for Financial Reform, Better Markets and Consumer Federation of America released this statement in opposition to the two bills introduced last week by Representative Phil Roe (H.R. 4293) and Representative Peter Roskam (H.R. 4294) to undermine the Department of Labor’s efforts to establish a best interest standard for retirement advice and finally protect retirement savers. Both bills would require Congressional approval before the Department of Labor conflict of interest rule could take effect and, in the absence of such approval, would substitute an alternative standard that is weaker than the current broken status quo.
“These bills would be disastrous for all Americans struggling to save for retirement. They would not put the best interests of retirement savers first. In fact, they would continue to enable advisers to put their economic interests above the interests of their clients trying to save for retirement. That is wrong and that is what the DOL ‘best interest’ rule would finally fix.
These bills would not only kill the DOL’s strong rule proposal, they would replace it with something far worse. They would actually preserve existing loopholes in the definition of investment advice that have for decades made it all too easy for financial firms to provide conflicted investment advice to retirement savers that is not in their best interest. They would also add a huge new seller’s exemption that advisers could easily invoke to avoid any form of best interest standard. They would even lower existing standards for those who would remain covered despite the new exemption. Additionally, the bills rely far too much on disclosure—an approach that has proven to be insufficient to protect investors from conflicts of interest.
Finally, these bills would even gut the requirement under the Congressional Review Act that there be bipartisan support for any effort to overturn an agency rule. Instead, Republican opposition alone would be enough to kill the DOL rulemaking. This would be a dangerous precedent with far-reaching implications.
No one who cares about the retirement security of America’s working families can, in good conscience, support these bills.”
The AFL-CIO is the country’s largest labor federation, with 56 affiliate unions representing some 12 million working men and women. To learn more, visit www.aflcio.org. Media Contact: Amaya Smith, (202) 637-5018, [email protected].
Americans for Financial Reform is a coalition of more than 200 national, state, and local groups who have come together to work for a safer, fairer, and simpler financial system. Members of our coalition include consumer, civil rights, investor, retiree, community, labor, faith based, and business groups. To learn more, visit www.ourfinancialsecurity.org. Media Contact: Jim Lardner, (202) 466 3311, [email protected].
Better Markets is an independent, nonprofit, nonpartisan organization that promotes the public interest in financial reform in the domestic and global capital and commodity markets. Better Markets advocates for transparency, oversight, and accountability with the goal of a stronger, safer financial system that is less prone to crisis and failure thereby eliminating or minimizing the need for more taxpayer funded bailouts. To learn more, visit www.bettermarkets.com. Media Contact: Jeff Gohringer, (202) 618 6430, [email protected].
Consumer Federation of America is a non-profit association of more than 250 national, state, and local pro-consumer organizations. It was formed in 1968 to represent the consumer interest through research, advocacy, and education. To learn more, visit www.consumerfed.org. Media Contact: Barbara Roper, (719) 543-9468, [email protected].
Category: Press Releases