Sheridan Stunned By Calvert’s Attempt To Override Veto That Would Protect Families and Seniors – July 6, 2016
Tim Sheridan, the Democratic candidate for Congress in California’s 42nd District, today criticized 23-1/2 year incumbent Congressman Ken Calvert for his recent vote to override President Obama’s veto on a Department of Labor rule that requires that financial advisors to act in a fiduciary capacity when advising clients.
The Department of Labor, which regulates tax-advantaged savings accounts, recently changed the status of financial advisors to require that they serve as fiduciaries when advising clients. In such a capacity, financial advisors would be required to put their clients’ best interests ahead of their own in the same manner that doctors and attorneys do. The rule, which was promoted by the White House in early 2015 due to the fact that Americans were losing millions of dollars every year to “conflicts of interests” among advisors who earn commissions, is scheduled to take effect in April 2017.
Following the DOL’s announcement that it intended to implement the rule, both the Republican House and Senate passed a bill that directed the DOL to withdraw it. After that, President Obama vetoed Congress’ action. That led to the vote last week where Mr. Calvert and his colleagues were unable to override the President’s veto. Given the President’s action, the rule will take effect in the coming months.
“Everyday in Congress, members vote on issues that could have an effect on each and every one of us,” Sheridan said. “Last week Mr. Calvert voted to lower the standard of care that a licensed financial advisor owes to their client. In other words, he voted to allow a financial advisor to consider how much money he/she will make when selling a person a financial investment instead of considering what is best for the client.”
Under the current standard, a licensed financial advisor who might make $1000 selling product X, but only $100 selling product Y, need not tell his client about product Y even if it would be better for the client’s finances.
“It would be like a doctor recommending surgery to a patient so they can make more money instead of a medication regimen that would be just as effective,” Sheridan noted.
“President Obama’s veto was a smart decision that will protect the investments of families and seniors around the country,” Sheridan added.
“Mr. Calvert, on the other hand, has again demonstrated that he cares more about deepening the pockets of people who control the money in this country ahead of the financial health of millions of American investors,” Sheridan concluded. “We can do better.”
California’s 42nd Congressional District, a geographical area shaped like the letter “X.” runs along the I-15 corridor from Eastvale, southeast to Temecula, and northeast along the I-215 and CA-79 corridors to Beaumont. It also includes the communities of Corona, Norco, Lake Elsinore, Wildomar, Murrieta, Menifee, Sun City, Winchester, Homeland and Nuevo. Mr. Sheridan lives in Lake Elsinore.