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U.S. CapitolIRI Testifies that the Proposal is a Solution in Search of a Problem

 WASHINGTON, D.C. – The Insured Retirement Institute (IRI) told a House subcommittee that a proposed U.S. Department of Labor investment advice regulation is a “solution in search of a problem” and should be withdrawn.

The House Capital Markets Subcommittee of the House Financial Services Committee conducted a hearing today to examine the DOL’s proposed regulation and its effect on retirement savings.

Jason Berkowitz, Chief Legal and Regulatory Affairs Officer at IRI, said in his hearing testimony that protected lifetime income products help retirement savers manage the risk of running out of money in retirement, and professional financial guidance helps consumers acquire and use those products appropriately.

“Retirement savers should be able to select their preferred source of professional guidance to help them prepare for retirement and to choose retirement savings strategies and products that best fit their individual needs,” Berkowitz said. “The DOL’s proposal would impair their ability to do so.”

Berkowitz said that IRI has long supported the application of a best interest standard to firms and financial professionals who provide advice or recommendations about insurance or investment products to retirement savers.

IRI believes the vast majority of firms and financial professionals already act in the best interest of their clients and that the existing regulatory framework provides the necessary protections to maintain this standard.

“To be clear, we believe all financial professionals should be required to act in their clients’ best interest when providing guidance on retirement savings strategies and products, as they are required to do under the U.S. Security and Exchange Commission’s (SEC) Regulation Best Interest standard and substantially similar rules that have been adopted by 41 states and counting,” Berkowitz said.

He continued, “IRI supported those important measures, which provide regulators with the tools they need to protect retirement savers and appropriately address the conduct of bad actors. With these rules in place and being actively enforced, the DOL’s proposal is a solution in search of a problem.”

The public comment period for the DOL proposal ended on January 2. IRI filed extensive, detailed comments opposing the proposed rule.

Link to written testimony.

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Contact: Dan Zielinski

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