Senate Likely To Repeal Obama's Retirement Advice Protection Rule
On Tuesday, the Senate will vote on repealing a new rule aimed at protecting retirees from being preyed upon by financial brokers. President Barack Obama released the new rule in April, which requires brokers to operate with their clients’ best interest in mind. In the past, these brokers were allowed to recommend expensive or risky investments without thorough disclosure in order to generate kick-backs or higher fees for themselves.
Obama made the retiree protection rule a second-term priority, but the rule has been met with strong opposition from the financial industry and Republicans in Congress.
Brokers argue that the rule will be expensive for their business and force them to raise prices for the services they provide to retirees, ultimately making investment advice unaffordable to many Americans.
On April 28, the House of Representatives voted to repeal the new rule, and the Republican-controlled Senate needs only a simple majority vote on Tuesday to do the same.
Democratic Senator Elizabeth Warren, who has fought hard for more financial regulation since the Financial Crisis, said this week that Republicans voting to repeal the retirement advice protection rule want to make it "easier for giant Wall Street financial institutions to cheat Americans out of their retirement savings.”
She went on to say that senators that vote to repeal the rule will likely have no problems soliciting campaign donations from the financial industry in the future.
For retirees worried about the impact of Tuesday’s vote, it’s likely that President Obama will veto any bill that would strike down the new rule.
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