The Department of Labor would have to stop its efforts to update a fiduciary rule and let the Securities and Exchange Commission act first under a bill passed by the House of Representatives late Tuesday.
In the 245-186 vote, three Democrats joined 242 Republicans to approve the measure sponsored by Rep. Ann Wagner, R-Mo, a Financial Services Committee member.
“The Department of Labor's rule proposal — if adopted in its current form — would do great harm,” said Paul Schott Stevens, Investment Company Institute president and CEO, in a statement after passage of H.R. 1090, the Retail Investor Protection Act. “H.R. 1090 reflects a common-sense goal of ensuring that federal agencies work to adopt a harmonized fiduciary duty for all investors, and that they do so in a manner that does not jeopardize investor access to personalized and cost-effective investment advice.”
The ranking Democrat on the committee, Rep. Maxine Waters, D-Calif., said in a statement that “we should not make retirement savers wait any longer for protection by hinging the DOL's rule-making to the SEC's.”
The Senate does not have counterpart legislation, and the White House said in a statement that President Barack Obama would veto any final legislation that “puts a roadblock in the way of preventing such harmful conflicts, which hurts businesses, consumers, and retirees and their families.”