Members of Congress take action to block DOL fiduciary rule

Resolution could stop implementation of new regulations for financial advisors

Posted April 21, 2016

On April 19, members of Congress introduced a resolution, under the Congressional Review Act, to block the Department of Labor’s (DOL) fiduciary rule. If passed, the resolution could block the agency’s rule, which is scheduled to go into effect in April 2017.

Under the Congressional Review Act, Congress may pass a resolution of disapproval to prevent, with the full force of the law, a federal agency from implementing a rule or issuing a substantially similar rule without congressional authorization.

The congress members that introduced the resolution are Rep. Phil Roe (R-TN), chairman of the Education and the Workforce Subcommittee on Health, Employment, Labor, and Pensions, along with Rep. Charles Boustany, chairman of the Ways and Means Subcommittee on Tax Policy, and Rep. Ann Wagner (R-MO).

The fiduciary rule, which addresses conflicts of interest in investment advice, primarily impacts advisors who charge a fee. Employers don’t normally offer such advice; however, an employer may be a fiduciary due to managing a benefit plan or choosing a service provider. The selection of a service provider is a fiduciary duty, and it comes with the obligation to monitor the services offered, and fees charged, by that provider.


 

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