SIFMA keen to work with Trump on overturning fiduciary rule
SIFMA will focus its lobbying efforts next year on harmonizing regulations and pushing back on the fiduciary rule.
“We will continue to advocate where rules can be improved and where there could be better co-ordination. It would be good for the regulators to stop and look at whether the regulations are doing what they should," says Ken Bentsen, CEO of SIFMA, one of the largest trade groups representing wealth management firms.
SIFMA may find a partner in President-elect Trump. Bentsen says the group is committed to working with Trump to eradicate conflicting guidance, and to advocate for a complete overturn of the fiduciary rule. The group has not yet met with Trump or his advisers, Bentsen adds.
While Trump has said he wants to generally reduce regualtions, and that he will dismantle the Dodd-Frank Act, he has not commented directly on the fate of the fiduciary standard. The Department of Labor rule is set to be phased in starting April 10, 2017.
The firm detailed its compliance plans while acknowledging that the regulation could be changed under President-elect Trump.December 1
Other Republicans have expressed their opposition to the Labor Department regulation. Rep. Jeb Hensarling (R., Texas), chairman of the House Financial Services Committee, said during a committee hearing in November that Republicans will work with Trump to overturn the fiduciary rule and other regulations.
SIFMA, which says it represents approximately one million employees in financial services and is one of the largest lobbying groups in the industry, has vehemently opposed the fiduciary rule since the Labor Department first began working on it in 2010.
It argues that the rule will do clients more harm than good by limiting their access to investment products and professional advice, especially those with smaller accounts.
Timothy Scheve, CEO of Janney Montgomery Scott and the 2017 chair of SIFMA’s board of directors, restated this position at the Wednesday briefing in New York, as well as the organization’s view that the SEC should be the pre-eminent agency in charge of all securities regulations.
Currently, the Labor Department has regulatory oversight of retirement assets, under a 1974 law known as ERISA. The SEC is also tasked with creating a fiduciary standard under Dodd-Frank.
SIFMA, along with the U.S. Chamber of Commerce, FSI and other business groups, filed a lawsuit in June asking a federal court in Texas to throw out the new regulations. SIFMA intends to pursue the case, according to Bentsen.
In addition to the fiduciary rule, the industry group’s key advocacy priorities for 2017 are new rulemakings related to the U.S. Treasury markets, tax reform and infrastructure, according to SIFMA’s year-end report.
SIFMA leaders also highlighted the protection of elderly investors as a focus area for the group, which is working on policies and procedures targeting fraudulent activity against senior clients.