Sen. Elizabeth Warren is demanding an investigation into whether conflicting comments from insurance company executives may have violated securities laws.
The Labor Department is preparing the final draft of a new rule which imposes stricter standards on brokers and financial advisors who work on retirement accounts, according to a Wall Street Journal report. Under the rule, advisors would have to put their clients’ interests above their own financial gain – a rule stricter than the current standard.
The rule has been adamantly opposed by the industry, which claims it would endanger a business model based on commissions and revenue sharing, the Journal reported. Recently, executives at four insurance companies – Lincoln National Life Insurance Co., Jackson National Life Insurance Co., Transamerica Corp. and Prudential Financial – made statements that the rule would cause significant problems for their businesses. However, when speaking with investors, all four companies said they were well-prepared to deal with the new regulation, the Journal reported.
Warren (D-Mass.) was today preparing to request that the Securities and Exchange Commission investigate the disparate statements, pointing out that securities laws bar companies from misleading investors about information that could affect the health of the business.
“Both sets of industry claims … cannot possibly be true,” Warren wrote in a letter to SEC head Mary Jo White. “And if one of these public statements is materially false, it would appear to violate long-standing interpretations of our securities laws.”
