The American Bankers Association and 12 associations are urging senators and House lawmakers to support Congressional Review Act resolutions that would overturn a Department of Labor final rule that expands fiduciary status to nearly all financial professionals.
In a joint letter, the associations said the rule poses a direct threat to the financial security of millions of America’s workers and retirees, with a disproportionate impact on low- and middle-income workers. A similar DOL fiduciary rule in 2016 resulted in more than 10 million small retirement account owners—with more than $900 billion in savings—losing access to their financial professionals, they said. In addition, the new rule is estimated to increase the wealth gap by reducing projected individual retirement account balances of Black and Hispanic Americans by 20% over 10 years.
The associations also said the rule is unnecessary in light of existing federal and state rules; that it undermines the intent of Congress in passing the Secure Act and Secure 2.0, which sought to strengthen retirement systems; and that the DOL’s rulemaking process was rushed and dismissive of public input. “Given the DOL’s blatant disregard for the limitations on its authority as established by Congress and the federal courts, Congress would clearly be justified in passing the CRA resolutions to disapprove the final rule,” they said.
