WASHINGTON Feb 3 U.S. President Donald Trump
will sign executive orders on Friday to review the Dodd-Frank
Wall Street reforms and halt a Labor Department rule designed to
curb potential conflicts among brokers who give retirement
advice, according to a senior White House official.
Trump's move marks a step toward making good on a campaign
promise to dismantle the 2010 Dodd-Frank law, which was passed
in the wake of the 2007-2009 financial crisis.
Earlier this week during a meeting with business owners,
Trump described the Wall Street reform law as "a disaster."
The official said the Dodd-Frank executive order will ask
the Treasury secretary to work with other regulators to
determine what the administration can do to fix issues with
measures issued under the 2010 Dodd-Frank Wall Street reform
"There are quite a few things that we could do on Dodd-Frank
... that we think will have fairly immediate and dramatic
impact," the official told reporters at a briefing on Thursday.
Some of those changes could include personnel changes at
regulatory agencies or additional executive orders, the official
The Labor Department's retirement advice rule is not part of
the Dodd-Frank law, but has long remained a thorn in the side of
the financial services sector.
It was issued by the Obama administration in 2016, and is
set to take effect in April.
The rule requires brokers to act as "fiduciaries," or in
their clients' best interests, when they are advising them about
their individual retirement accounts and 401K plans.
That is a departure from the current legal standard, which
requires brokers only to recommend investments that are
"suitable" to their clients.
Complying could cost firms as much as $31 billion over the
next decade, according to Labor Department estimates.
Trump's memo will ask the Labor Department to determine
whether the rule should be revised or be scrapped altogether,
the official said.
"We think that they have exceeded their authority with this
rule and we think this is something that is completely
overreaching," the official said.
Opponents of the rule argued that the rule would result in
high costs that will ultimately make small accounts
They have also insisted that the Securities and Exchange
Commission, which regulates the brokerage sector, has more
expertise and should take the lead on writing new rules.
Dodd-Frank gave the SEC the authority to craft its own
fiduciary rule for brokers, but so far, the agency has not
advanced such a measure.
The U.S. Chamber of Commerce and other financial services
trade groups have filed a legal challenge to the department's
fiduciary rule seeking to have it overturned.
The federal judge reviewing the case signaled in a court
filing on Thursday she plans to issue a decision no later than
Bank stocks were up in premarket trading on Friday, in
advance of Trump's plans to meet with CEOs of major U.S.
companies including JP Morgan Chase & Co.
(Reporting by Ayesha Rascoe and Sarah N. Lynch; Editing by Lisa