STATEMENT: House Disapproval of Fiduciary Rule a Raw Deal for Consumers, Says CAP Consumer Finance Director
Washington, D.C. — This afternoon, the U.S. House of Representatives voted to pass H.J. Res. 88, a resolution of disapproval for the U.S. Department of Labor’s final rule on conflicts of interest in retirement advice, commonly known as the fiduciary rule. Announced earlier this month, the department’s rule requires that financial advisers act in their clients’ best interest rather than their own and closes a 40-year-old loophole that allowed conflicted sales pitches to be marketed as advice.
Joe Valenti, Director of Consumer Finance at the Center for American Progress, issued the following statement:
Today’s House action is a raw deal for consumers seeking trust in government and the financial system as families continue to rebound from the Great Recession. American families are ultimately expected to save $17 billion per year through lower fees, higher returns, and better advice under the department’s rule. The Department of Labor has taken the concerns of many stakeholders into account and carefully crafted a final fiduciary rule that will truly hold financial professionals accountable for the retirement advice they give. Yet, while the ink has barely dried on this rule—a rule-making that has taken more than six years—the House has decided yet again to scrap this effort and leave consumers open to predatory financial advice. Savers and retirees expect advisers to put their needs first, and the Department of Labor has done just that.
Related resource: A Secure Retirement Demands Limiting Conflicts of Interest by Joe Valenti
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