The Department of Labor’s proposed fiduciary rule would dramatically expand the already high administrative and compliance costs faced by stockbrokers, financial advisors and other financial services professionals who offer investment products to Americans, Sen. Tommy Tuberville (R-Ala.) wrote in a recent opinion column for the Daily Caller.
The DOL’s proposed rule would extend fiduciary status to advice on rollovers and investments related to commodities and insurance products like fixed annuities. In his column, Tuberville said that such an expansion may sound reasonable, but in reality, the rule will create additional red tape that will force financial services firms to increase their costs and rethink how they serve clients.
“Some Americans want a financial advisor who acts as fiduciary,” Tuberville said. “For those individuals, advisors who meet that high legal standard are available. Other Americans choose to employ a broker to buy and sell investment products like stocks, bonds, annuities and insurance. In these relationships, the customer decides what to buy or sell, and the financial services professional executes the transaction. Both models make sense for certain people. The bottom line is that it should be up to individual Americans to decide what sort of financial advisory relationship they would like to have—not the federal government.”