Americans for Tax Reform released a letter encouraging Department of Labor Secretary Alex Acosta to not appeal the recent court ruling from the 5th Circuit of Appeals which vacated the Department’s fiduciary rule.
The full letter can be found here and below.
April 11, 2018
The Honorable Alexander Acosta
Department of Labor
200 Constitution Avenue, N.W.
Washington, D.C. 20210
Dear Secretary Acosta:
On March 15 the Fifth Circuit Court of Appeals vacated the Department of Labor’s (DOL) fiduciary rule finding that the agency had exceeded its statutory authority under the Employment Retirement Income Security Act of 1974 (ERISA). I encourage you to direct the Department of Justice to not appeal the Court’s ruling as the ruling is a strong victory for consumers, investors and retirement planners.
Roughly two years ago in April 2016, the Department of Labor finalized its fiduciary rule; a one-size-fits-all approach to defining the “best interest” standard for investment professionals and their clients. The rule will greatly reduce the ability of financial advisors to give advice to IRA and 401(k) customers with one report noting that 35 percent of advisors surveyed “will move away from low-balance accounts” or accounts with less than $25,000 in assets. Additional estimates show the rule could disqualify up to 7 million IRA holders from seeking advice and reduce new IRA openings by hundreds of thousands annually.
Additionally, I have emphasized the importance of this lawsuit brought forth by a coalition of business groups seeking to block this misguided Obama era rule. Americans for Tax Reform has supported congressional efforts to roll back the Department’s rule using the Congressional Review Act and stop DOL from writing a similar rule in the future. Unfortunately, President Obama vetoed the resolution and kept in place a rule that places Washington in between savers and planning for retirement.
With the Court’s recent decision, this marks a significant opportunity to leave an Obama era regulation right where it belongs – with the previous administration. I encourage you to let the Court’s decision stand and protect consumers access to affordable retirement services.
Grover G. Norquist
Americans for Tax Reform