The Department of Labor recently announced that it would extend the comment period for the controversial fiduciary rule 15 days, originally set to end on July 6. The move represents an about face after Labor Secretary Thomas Perez last month indicated that the agency would not be extending the comment period because the timeline already provided “a long time” for voices to be heard.
Save Our Retirement, a consortium of organizations that support the DOL’s proposal including the AFL-CIO and AARP, had strongly urged the DOL not to extend the comment period. The group argued that “no justification for further delay in the effort to close the loopholes in the DOL’s outdated rules that are costing American workers and retirees tens of billions of dollars annually.” Further, “[e]very single day that passes without a strong fiduciary duty rule means between $57 million and $117 million of retirement savers’ hard-earned money is lost to conflicted investment advice.”
However, many groups found the 75-day comment period to be too much of a rush. The Financial Services Roundtable, writing on behalf of many industry participants, urged the DOL to extend the comment period by 45 days. The FSR argued that it had no first-hand knowledge of the proposed regulations prior to their public release on April 20, and that changes such as those proposed have historically “required lengthy periods of collaboration with the Department, and engagement by the financial services industry to work through the very complicated issues raised.”
Though the White House had been pressing for action on the proposal, many democratic Senators and Representatives felt that the process was moving too quickly. Senator John Tester, joined by seven other Senate democrats and one independent, requested that the DOL extend the comment period to a total of 120 days. Representative Frederica Wilson penned a similar letter, joined by 17 of her democratic colleagues, arguing that “[c]onsidering the importance, scope, and increased size of this Proposal, it is vital that our constituents, Congress, and all other interested parties have the opportunity to fully understand all of these changes.” On the republican side, 36 senators joined in a letter by Senator Lamar Alexander.
In a statement released after the DOL’s announcement, the FSR thanked the DOL, but expressed disappointment with the short extension: “The Department has told us on multiple occasions they want a thoughtful response on a thousand page rule-making they spent four years devising. While we appreciate the extra two weeks, federal regulators should further extend the comment period.”