BOSTON (TheStreet) -- As the Senate prepares to debate the American Jobs and Closing Tax Loopholes Act (H.R. 4213) passed by the House on May 28, the investment-management industry is expressing concern over fee disclosures in 401(k) plans.
In a May 24 letter to Majority Leader Harry Reid (D-Nev.) and Minority Leader Mitch McConnell (R-Ky.), the
, a national association of U.S. investment companies, described the bill's proposed regulations as "redundant" and "counterproductive" to those by the Obama administration and the
Department of Labor
The Department of Labor, which has spent more than two years negotiating with the industry, had intended to issue rules and guidance this summer. The ICI says those efforts may be wasted because the new law would trump the proposed rules and force the process to start from scratch.
"Enacting 401(k) fee provisions in H.R. 4213 will simply delay implementation of disclosure reform because regulators will need to interpret the new provisions and draft proposals to implement them," the ICI letter reads.
In a June 4 letter to the Senate, a similar opinion was put forward by the SPARK Institute, which represents the interests of retirement plan service providers and investment managers. It fretted that "enacting legislation at this time that is at best duplicative of, and at worst in conflict with, the pending regulations will be disruptive and costly for everyone affected by them, including regulators."
"We are also concerned about the haste with which the fee disclosure provisions have been added to the proposed legislation and that affected parties have not had adequate time to fully consider and assess their impact and implement in the appropriate time frame," says Larry Goldbrum, SPARK Institute's general counsel.
-- Reported by Joe Mont in Boston.
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