Rep. Ann Wagner, R-Missouri, says the Department of Labor is “dug in” in its effort to finalize its proposed fiduciary rule.

“But I’m pretty dug in too,” she said in a press call in advance of tomorrow’s hearing before the House Financial Services Committee, “Preserving Retirement Security and Investment Choices for All Americans.”

Wagner, who has led the opposition to the DOL’s effort to impose fiduciary requirements on the broker-dealer industry since she sponsored the Retail Investor Protection Act in 2013, said she will reintroduce that bill, which would require the Securities and Exchange Commission to be the lead regulator in writing a uniform fiduciary standard.

She expects the bill will be marked up and moved to a vote in the Financial Services Committee by the end of the month.

“This is good legislation,” she said of the bill, insisting it is necessary to preserve lower and middle-income retirement savers’ access to financial advice.

Last month, Labor Secretary Thomas Perez wrote Wagner four days before the Department held its public open hearings on the proposal, informing her of his commitment to finalizing a new rule.

Wagner voiced her criticism of Perez for vowing to finalize a rule before considering stakeholder testimony at the public hearings, which she said proved that the “divide” between industry and the DOL is so wide that a workable rule cannot be expected.

A new fiduciary rule, which she called a top priority of the Obama Administration, may be difficult to deter through legislation.

In 2013, the Retail Investor Protection Act passed the House with the 30 votes from Democrats. It later stalled in the Senate, then controlled by Democrats.

This go-around, Republicans are, of course, in charge of both chambers. Wagner noted that 12 Senate Democrats have written Sec. Perez expressing concern for the rule’s potential for unintended consequences for middle-income savers.

If the bill were to pass both chambers—it will have to do so quickly, as some speculation has the DOL finalizing its rule as early as the beginning of next year—it then would have to survive a likely veto from President Obama.

“We haven’t looked at whether we have the numbers to override a veto,” said Wagner, who suggested she would cross that bridge if and when it comes.

While she said passing the legislation on its own is the best way forward, she also said that in the event of a veto, there are ways through the appropriation process “to deal with this.”

Before it comes to that, Wagner is counting on public opposition to the DOL’s rule to force the White House to reconsider its support.

She cited the White House’s sudden withdrawal of plans to tax 529 college savings plans early in 2015.

When congressional leaders in his own party raised concerns that the tax would hurt the middle class, the White House walked the proposal back “pretty darn fast,” said Wagner.

But that rule had only been proposed for several weeks, not the more than five years the DOL has worked to coordinate its current proposal.

And intense lobbying from House Minority Leader Nancy Pelosi, D-California, and other high-ranking Democrats was necessary to convince President Obama to back off the 529 tax.

Tomorrow’s hearings will be held by two subcommittees of the Financial Services Committee: the Oversight and Investigations subcommittee and the Capital Markets and Government Sponsored Enterprises subcommittee.

Instant Insights /

Rep. Wagner set to reintroduce Retail Investor Protection Act

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