U.S. Sen. Tommy Tuberville (R-AL) introduced legislation that would prohibit the U.S. Department of Labor (DOL) from issuing a regulation or guidance that limits the type of investments in a 401(k) plan.
His bill – the Financial Freedom Act — is in response to regulatory guidance released by the Employee Benefits Security Administration, an agency inside the U.S. Department of Labor (DOL), back in March. The guidance warns fiduciaries to use extreme care before adding a cryptocurrency option to a 401(k) plans investment menu. It also cautions plan sponsors about offering them through brokerage windows. EBSA said it would investigate plans that offer participant investments in cryptocurrencies and related products and appropriate action to protect the interests of plan participants and beneficiaries.
Tuberville’s bill would prohibit the Secretary of Labor from constraining the range or type of investments offered to participants and beneficiaries of individual retirement accounts.
“The Financial Freedom Act empowers the American retirement saver and preserves the precedent of investment freedom,” Tuberville said in introducing this bill in the U.S. Senate. “The choice of what you invest your retirement savings in should be yours – not the government’s. The government-knows-best approach being pushed by the current administration runs counter to the values that made our country the most prosperous nation in history.”
The Financial Freedom Act has the support of several organizations, including Americans for Tax Reform, Heritage Foundation, Chamber of Digital Commerce, Blockchain Association, and Association for Digital Asset Markets.
“Investors have more information than ever and are able to access products in faster and more transparent manners,” Michelle Bond, CEO, Association for Digital Asset Markets, said. “At the same time, the world’s brightest minds are creating new products in the digital asset space with utility and financial upside. Placing regulatory hurdles targeted at specific products, such as digital assets, does not benefit consumers and affects Americans’ ability to exercise consumer choice and maintain a diversified portfolio. Senator Tuberville gets this right with his Financial Freedom Act, which fosters 401(k) investments in digital assets. The Senator’s bill has the Association for Digital Asset Markets’ (ADAM) full support.”
U.S. Rep. Byron Donalds (R-FL) introduced companion legislation in the U.S. House of Representatives.