Tuesday, June 18, 2013

CBC, CHC & CAPAC Members Express Concern about DOL Fiduciary Rule

According to Financial Advisor magazine:
Members of the Congressional Black, Hispanic and Pacific Asian caucuses have asked the Department of Labor to not harm their constituents in revising the definition of a fiduciary.
The concern expressed in the letter is about small savers who traditionally work with financial professionals who are paid via commission to open and maintain IRAs.

The article explains that:
If commissions on these types of accounts are prohibited [under the new rule] and advisors are restricted to charging fees, many financial advisors will be put out of business and millions of IRA holders will be priced out of the market for financial advice, [Christopher Paulitz of FSI] says. This will disproportionately hurt minorities and women who hold the majority of small IRA accounts, he says.
Media reports suggest the DOL rule will be released sometime after July.  Dozens of members of Congress have asked the DOL to protect small savers' ability to work with the financial professionals of their choice.  As this article suggests, it is still unclear if the DOL has listened.