Mike Bloomberg says he’ll restore the Department of Labor’s fiduciary rule if elected president.
The former New York City mayor, who recently entered the Democratic presidential nominee race, has issued his retirement security policy objectives, promising to “strengthen entitlement programs and supplement the private retirement savings system to ensure that no American senior has to live in the shadow of financial peril.” Among his proposals — which also address Social Security, Medicare and Medicaid and housing security for seniors — is bringing back the Obama-era fiduciary rule, which required retirement account advisors to put clients’ interests first. The Fifth U.S. Circuit Court of Appeals vacated the rule in 2018, after a directive from President Donald Trump’s administration for the DOL to review it.
Bloomberg’s policy release states that “[f]inancial advisers who work on commission sometimes prey on elderly customers, steering them into expensive funds and annuities and away from better alternatives.”
Bloomberg’s announcement quotes a February 2015 release from the White House that estimated the extra fees charged to retirement savers at “billions of dollars a year.”
“The Labor Department issued a rule to protect investors by requiring such advisers to disclose conflicts and requiring them to put clients’ interests first. The Trump administration has reversed the rule. Mike will protect elderly investors from conflicted financial advice and improve the financial position of retirees,” the policy release states.
It’s unclear whether Bloomberg would also seek to replace the DOL’s new chief, Eugene Scalia, tapped by Trump in August 2019 in the wake of the resignation of Labor Secretary Alexander Acosta over criticism of his handling of a decade-old plea deal with convicted sex offender Jeffrey Epstein.
Scalia was a key player in overturning the DOL’s rule as one of the lawyers representing Sifma and the U.S. Chamber of Commerce in their legal challenge to the rule. Despite objections from various parties — including Bloomberg’s competitor for the Democratic presidential nomination, Sen. Elizabeth Warren, D-Mass. — about Scalia’s role in killing the previous rule, the DOL’s ethics attorneys determined that neither its own ethics rules nor the Trump administration’s ethics pledge precluded Scalia’s involvement in drafting a new rule.
The DOL was expected to put out a new version of the rule in December 2019 but has yet to do so.
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