The Labor Department's Fiduciary Rule: How A Flawed Process Could Hurt Retirement Savers

Publication

The Labor Department's Fiduciary Rule: How A Flawed Process Could Hurt Retirement Savers

Senate Committee on Homeland Security and Governmental Affairs

Abstract

Under the leadership of Senator Ron Johnson, the Senate Committee on Homeland Security and Governmental Affairs issued a Majority Staff report on a proposed rule by the Labor Department which restructures the definition of investment guidance. The report discusses the purpose of the rule, which is to avoid conflict of interests, and how this rule could have negative consequences for investors of lower socioeconomic status. The Committee finds that the proposal could cause losses of tens of billions of dollars in retirement savings, and could put onerous burdens on investment advisors that complicate their jobs and increase litigation threats.