Washington, D.C. — This afternoon, the U.S. Senate 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 last 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, the Senate voted to side with conflicted retirement advisers instead of American savers and retirees—just as the House did last month—to the tune of $17 billion per year in higher fees. This is a raw deal for families seeking to rebound from the Great Recession who expect financial institutions and government to be accountable for protecting their interests. The Department of Labor has taken more than six years to carefully craft a final fiduciary rule that would truly hold financial professionals accountable for the retirement advice they give. Yet while the ink has barely dried on this rule, the Senate has decided to scrap this effort in favor of 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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