President Trump has nominated Eugene Scalia to be the next Secretary of Labor. On July 12th, Alexander Acosta was forced to resign due to the controversy over a plea deal for Jeffery Epstein, who was recently charged with sex-trafficking crimes by the US Attorney for the Southern District of New York. At the time, Mr. Acosta was the US Attorney. The plea deal has been controversial because many viewed it as too lenient. Mr. Scalia has held several government posts including Solicitor of Labor in the second Bush administration. This is the top legal position in the Department of Labor. He is viewed as more conservative than Mr. Acosta. Before Mr. Acosta’s departure, the Department had announced that it is on track to publish a new fiduciary rule by year’s end, to replace the original rule struck down by the Fifth Circuit of the Federal Court of Appeals. The Fiduciary Rule was a complex regulation where persons working with retirement plans and participants are fiduciaries and may only make investment recommendations that are in the best interests of their clients. If Mr. Scalia is confirmed as the next Secretary of Labor, the possibility of a new fiduciary rule may be in doubt.
This information was developed as a general guide to educate plan sponsors and is not intended as authoritative guidance or tax/legal advice. It is not intended to provide specific legal, tax or other professional advice. The services of an appropriate professional should be sought regarding your individual situation.