Republican lawmakers have reintroduced a bill in the Senate and House to prohibit the Department of Labor from issuing a regulation or guidance that limits the type of investments 401(k) plan participants can choose through a brokerage window.
Sen. Tommy Tuberville, R-Ala., and Rep. Byron Donalds, R-Fla., reintroduced the Financial Freedom Act on April 1.
The bill has been introduced in the previous two congressional sessions, most recently in February 2023. The initial bill was in response to March 2022 Labor Department guidance for 401(k) plan fiduciaries telling them to "exercise extreme care" before selecting cryptocurrency as an investment option in plan menus.
“The Biden administration was hell-bent on controlling every aspect of Americans’ lives,” Tuberville said in a statement. “Meddling in 401(k) investments through overregulation restrains financial growth and restricts personal liberty. The federal government, which is $36 trillion (in) debt, shouldn’t be telling anyone how to invest their money. My bill ensures that hardworking Americans have the financial freedom to make decisions about how to invest their retirement savings.”
Crypto assets are not banned from plans governed by the Employee Retirement Income Security Act.
But in issuing its 2022 guidance, the Labor Department said incorporating crypto assets in participants' retirement accounts presents "significant risks and challenges to participants' retirement accounts, including significant risks of fraud, theft and loss."
