The U.S. Chamber of Commerce wants you to believe it is looking out for the little guy in its fight against new government regulation of the retirement investment advice industry.
But that is a facade – as one consumer advocacy group found out when it checked the Chamber’s claims of grassroots support for its battle to stop the U.S. Department of Labor’s new “best interest” standard for retirement advice.
This fight is really about something else – $19 billion in potential lost revenue now controlled by stock brokerage, life insurance and other companies that do not want to make drastic changes in their business models.
That is the amount of money up for grabs, according to Morningstar, in the wake of the new DoL rule. The so-called fiduciary standard requires any adviser working with retirement accounts to avoid conflicts and act in the best interest of clients in the products they recommend.
The final rules were released in April following years of study and input from the financial services industry and others. They are set to be phased in next year.
But opponents of the fiduciary rule continue their resistance. Last week President Barack Obama vetoed legislation approved by Congress in April to overturn the rule. Opponents also are pressing their case in court, filing lawsuits challenging the Labor Department’s power to impose the rule and calling it unworkable.
I take a closer look at the huge amount of business that is at stake for some segments of the financial services industry in my column today at Reuters Money.