WASHINGTON (9/10/15)--CUNA has written a letter urging Congress to consider the impact that the U.S. Department of Labor’s (DOL) proposed rulemaking defining fiduciaries would have on credit unions’ ability to offer retirement savings products and services to their members.
“Credit union members, and all consumers, deserve the best possible service when seeking information about retirement plans or Individual Retirement Account (IRA) distributions,” CUNA said in a letter Wednesday to U.S. Reps. Sean Duffy (R-Wis.), chairman of the House oversights and investigation subcommittee, and Al Green (D-Texas), ranking member.
“However, it is important to have rules that encourage and promote retirement savings--rather than potentially chill the ability of credit unions, or other financial institutions, to provide these products and services,” CUNA wrote.
The proposed rule is the topic of a hearing today on “Preserving Retirement Security and Investment Choices for All Americans” before the U.S. House subcommittees on oversight and investigations, and capital markets and government sponsored enterprises.
While CUNA supports the rule’s goal to protect investors and act in the investor’s best interest, the proposed rule “is full of complexities and unworkable solutions, which in no way will improve options for credit union members,” CUNA said in the letter.
In the letter, CUNA urged the subcommittee to consider whether the proposed rule “will have a detrimental impact on the ability of lower- or middle-income working American families to invest” and whether the DOL should narrow its definition of “investment advice” to “assure that credit union employees, who are only tangentially involved in providing investment services, are not included in the rule.” CUNA also noted that a credit union could be “adversely affected by the rule if they share a dual employee with a third party.”
CUNA also expressed concern about the compliance burdens imposed by the proposed rule and suggested that small or medium size credit unions “could be hesitant to engage in any activity that may sweep them into this expansive proposed rule, which could preclude their members from having access to investment products.”
CUNA encouraged Congress to examine in particular three areas and how they could affect consumers’ access to retirement and other investment services: