[Congressional Record (Bound Edition), Volume 162 (2016), Part 5]
[Senate]
[Pages 6949-6950]
[From the U.S. Government Publishing Office, www.gpo.gov]




                   DEPARTMENT OF LABOR FIDUCIARY RULE

  Mr. DURBIN. Mr. President, retirement savings are crucial for our 
economic security, but too many Americans have little to no retirement 
savings because of low wages and the need to provide for their 
families.
  Those who have been able to save for retirement are often confused by 
the unknowns of retirement planning and investing and depend on 
financial advisers to provide advice that is in their best interest.
  However, loopholes in the retirement advice rules have allowed some 
advisers to recommend products that put profits ahead of their clients' 
best interest, hurting workers and their families, and jeopardizing our 
economic security.
  The Department of Labor set out to update these decades-old rules to 
address conflicts of interest and require that financial advisers put 
their clients first, which is just plain common sense. Unfortunately, 
my Republican colleagues have voted to roll back this important 
consumer protection and voted to block the Department's fiduciary rule, 
an effort I did not and would not support.
  While most advisers operate under a best interest standard, some 
advisers steered their customers into investments that award big 
commissions and incentives to the adviser but are not in the best 
interest of the customer.
  No one knows this better than the Toffels of Lindenhurst, IL.
  Merlin Toffel was a Navy veteran and an electrician, and his wife, 
Elaine, was an accountant. After more than 40 years of work, they had 
built up an impressive nest egg, but when Merlin was diagnosed with 
Alzheimer's and could

[[Page 6950]]

no longer manage their finances, Elaine sought investment advice from 
an investment broker at their local retail bank.
  The broker told her to liquidate their retirement account and sold 
them variable annuities to the tune of $650,000. Elaine trusted his 
advice because she thought that it was in her best interest. She later 
found out that those annuities charged fees in excess of $26,000 a 
year, and if she needed to access the money right away for an 
emergency, she would be charged a surrender charge of more than 
$45,000.
  In the end, the Toffels lost more than $50,000 because of the 
broker's conflicted advice. Unfortunately, they are not alone. This is 
unconscionable and should not be allowed.
  The fiduciary rule will require advisers to disclose their fees and 
ensure access to quality financial advice, restore confidence to 
savers, and protect them from receiving conflicted advice, which has 
the potential to erode billions from retirement accounts of hard-
working Americans.
  The bottom line is that we need to support policies that safeguard 
worker retirement savings and help them prepare for retirement, and the 
fiduciary rule does just that.
  It saddens me that my Republican colleagues have acted to undermine 
American workers and families by blocking this rule. Thankfully, their 
efforts here today will not prevail because the President will veto 
this attempt to dismantle this important rule.

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