Date: 2015-10-27
Speaker: MAXINE WATERS (democrat)
Chamber: H
State: California

Mr. Chairman. I yield myself such time as I may consume. Mr. Speaker. H.R. 1090 would halt the Department of Labors ongoing efforts to protect American retirement savers from investment advice that conflicts with their best interests. The bill would prohibit the Department from promulgating any rule on the issue until 60 days after the Securities and Exchange Commission finalizes its own fiduciary rule for investment advisers and broker dealers. The bill would then delay the SECs long overdue rulemaking by requiring the Commission to first report to Congress a separate economic analysis that. among other things. considers how a new standard would affect a brokers profit. These delays are unacceptable and ignore the real issue that the Department is trying to address: conflicted retirement investment advice that costs our Nations workers and retirees an estimated $17 billion a year. The Departments rulemaking would do so by requiring persons providing retirement advice to put the interests of their clients ahead of their own and abide by a fiduciary duty. the same duty that we expect from our doctors. lawyers. and trustees. Simply put. a financial adviser should not be paid more for recommending one product over another. but should abide by a fiduciary standard of care. Would you be comfortable if your doctor was paid more for an office visit for recommending one drug over another or for a lawyer to be paid more for interpreting the law one way or the other? No. of course not. Yet. we allow these same conflicts to exist with those that are providing millions of hardworking Americans with advice on their retirement savings. These conflicts encourage investors to. for example. push a 70yearold retiree to invest more of her savings in a stock fund rather than a less risky shortterm bond fund simply because the adviser receives 150 percent more for making the riskier recommendation. Such a commonsense update in the law to address these conflicts is long overdue and. indeed. at the Department. is over 5 years in the making. During that time. the Department has published an initial 2010 proposal. solicited feedback. held public hearings on that proposal. and issued even a reproposal this past spring. Since that reproposal was published. the public and interested stakeholders have had 164 days of public comment. 4 full days of multipanel public hearings. and ample opportunity to meet with the Department. which held over 100 meetings with interested stakeholders. not including meetings with Members of Congress. Thanks to the Departments diligence and willingness to listen to stakeholder concerns. the proposal now enjoys broad support. including support from 95 financial services groups. public interest. civil rights. and consumer organizations. labor unions. and many investment advisers who are already providing advice to savers under a fiduciary standard. These groups range from the AARP. Public Citizen. the Consumer Federation of America. to the Financial Planning Coalition. among many others. All this points to the Departments tangible efforts to take a balanced. measured approach to developing a rule that works. I fully support their efforts to continue to work towards its completion not only because it is necessary. but because it just makes common sense. What is more. the need to update the law quickly is urgent. Hardworking Americans lose an estimated $17 billion per yearor $47 million per dayto conflicted retirement investment advice. While we should clearly encourage the Securities and Exchange Commission to also update its own rules on investment advice over securities. we should not make retirement savers wait any longer for protection by hinging the DOLs rulemaking to the SECs. as H.R. 1090 would do. Mr. Speaker. I support the Labor Departments efforts to finalize a rule and urge my colleagues to vote "no" on H.R. 1090. Mr. Speaker. I reserve the balance of my time.