Rep. Byron Donalds from Florida introduced the Financial Freedom Act to the United States House of Representatives Friday. This bill would prevent the U.S. Department of Labor’s limitation on the types of investments that are allowed in self-directed 401k retirement plans. This bill is the companion bill to Alabama Senator Tommy Tuberville’s May 5, Senate bill.
The Financial Freedom Act was created in response to a March 10th U.S. Department of Labor compliance report that raised objections about the inclusion of cryptocurrency in 401(k). The report stated that the Employee Benefits Security Agency of the Department “expects” to launch an investigation into plans offering investments in cryptocurrencies or related products and to take the appropriate actions to protect the rights of beneficiaries and plan participants.
Fidelity Investments, a financial services company, responded to the DOL report. It objected to the unclear language and positions that it felt were inconsistent with the intent of law that created 401(k). Fidelity Investments requested clarification from the DOL and that it withdraw the report. Fidelity joined other smaller financial service firms to offer Bitcoin to 401(k), plan holders two weeks later.
Related: Senator Warren asks Fidelity for help in addressing the risks of Bitcoin being included in 401(k).
Tuberville responded in an editorial to CNBC prior to the introduction of his bill: “Whether or not your belief in the long-term economic prospects for cryptocurrency, the choice about where you invest your retirement savings should be yours, not the government.”
Donalds said that the DOL restricted investors’ options for retirement accounts. He also stated in a tweet press release, “A far-reaching, sweeping effort to centralize Washington power” through the DOL Report.
Today, I introduced the House companion to the Financial Freedom Act 2022. This bill prevents Biden’s @USDOL depriving self-directed 401k account investors of the choice of investments. This bill is being championed by the great @SenTuberville in the U.S. Senate. pic.twitter.com/c5zOJUEzCN
— Congressman Byron Donalds (@RepDonaldsPress) May 20, 2022