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Financial firms ready for fiduciary rule, Sen. Elizabeth Warren says

Elizabeth Warren
Sen. Elizabeth Warren, D-Mass.

BlackRock (BLK), Vanguard Group, TIAA-CREF and 18 other financial firms support implementation of the Department of Labor’s fiduciary rule, Sen. Elizabeth Warren, D-Mass., said Tuesday in a letter to Acting Secretary of Labor Edward Hugler.

President Donald Trump on Feb. 3 ordered the Labor Department to reconsider the rule, but Mr. Trump did not call for outright delay or repeal.

The financial industry support came in response to a letter that Ms. Warren sent Jan. 19 to 33 financial firms, asking them where they stand on the rule that is scheduled to take effect in April. Ms. Warren said 21 firms responded to that request.

“Their overall message was clear: This rule is good for workers saving for retirement and companies are prepared to meet the compliance deadline,” Ms. Warren wrote. “They support the goals of this rule; they have invested in this rule; they have planned for this rule; and they will be ready by the April deadline.”

In its response to Ms. Warren, BlackRock said immediate action was needed to solve the retirement crisis, and many other firms said they have invested the time and resources to comply.

“BlackRock is supportive of changes to the financial ecosystem that enhance confidence in markets and investing — an integral component to solving the retirement crisis,” Vice Chairwoman Barbara Novick said in a Jan. 31 letter.

Roger W. Ferguson Jr., TIAA president and CEO, said in a Jan. 30 letter to Ms. Warren that the firm “has made significant capital investments” to accommodate the rule’s technical aspects in time for the April effective date. TIAA employees are not paid commissions.

In 2015, Ms. Warren’s office investigated the incentives used by some financial services firms that put advisers’ interests before clients and issued an updated report Feb. 3 on continuing practices.

A delay or repeal of the rule would put billions of retirement savings “straight into the hands of giant financial institutions,” Ms. Warren wrote.

The letter is available on Ms. Warren’s website.