Forty House Democrats urged DOL Office of Regulations and Interpretations ("ORI") Employee Benefits Security Administration Acting Secretary Edward Hugler to reconsider the DOL's proposed delay of the fiduciary rule, as mandated by President Donald J. Trump in a February 3, 2017 Memorandum (see previous coverage).

In their letter to Mr. Hugler, the lawmakers stated that the DOL "promulgated the fiduciary rule after conducting a thorough, thoughtful and transparent multi-year process." They emphasized the extensive preparation and immediate need for the final rule:

"[T]he final fiduciary rule is the product of more than six years of research, consideration of more than 300,000 comments, four days of hearings, and hundreds of meetings. It is unacceptable that now – roughly a month before implementation of the final rule is scheduled to begin – the DOL is carelessly proposing to delay it. . . . We believe it is imperative the final rule be implemented on schedule and without delay."

The letter cited industry support for the fiduciary rule, and asserted that "nine in ten Americans reportedly agree with the DOL's rule." In addition, the Democrats argued that the "retirement savings landscape has changed dramatically since the rule was last meaningfully updated in 1975," and that the DOL "provided appropriate relief that mitigates industry concerns and compliance costs." Moreover, "three separate lawsuits" found not only that the DOL "has the statutory duty to promulgate the rule under the Employee Retirement Income Security Act . . . but that its rule is a reasonable, workable solution that protects America's retirement savers."

Commentary

One can take issue with any number of the assertions made in this letter, but the most obviously questionable assertion is that the financial industry supports the rule. It is true that those firms that believe that the rule benefits them may support it, but if it were true that the industry generally supported the rule, then there would not be three lawsuits and the rule would not have been delayed. Likewise, that a court found that DOL had authority to adopt the rule is actually quite different from asserting that the court could find that the DOL had a duty to adopt the rule.

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