40% Of Comments Critical Of Fiduciary Rule Are Fake

Which is worse: the growing use of fraudulent digital submissions - or this Administration's willingness to ignore the evidence when it contradicts their policy goals?  JL

James Grimaldi and Paul Overberg report in the Wall Street Journal:

40% didn’t post the comment listed under their name, address, phone number and email.The Labor Department is the fifth agency to have posted unauthorized comments on its website. The Journal found fraudulent postings under names and email addresses at the Consumer Financial Protection Bureau, Federal Energy Regulatory Commission and Securities and Exchange Commission and the Federal Communications Commission. The findings were cited by Congress to delay repeal of the net-neutrality rule.
A significant number of fake comments appear among thousands criticizing a proposed federal rule meant to prevent conflicts of interest in retirement advice, according to a Wall Street Journal analysis.
At issue is the Labor Department’s “fiduciary rule,” which would require investment advisers handling retirement accounts to act in the best interest of clients. Written during the Obama administration, the proposed rule won’t be fully implemented until July 2019, and the Labor Department is still gathering feedback about it on its website.

Many of the comments weren’t written by the people they were attributed to, the Journal analysis found.
Consider the experience of Robert Schubert, a Devon, Pa., salesperson. A comment posted in his name on the Labor Department website opposed the rule, saying: “I do not need, do not want and object to any federal interference in my retirement planning.”
In an interview, Mr. Schubert said the comment was a fraud. He didn’t post it and doesn’t agree with it. “I am disgusted that people can post comments using my name,” Mr. Schubert said.
Mr. Schubert is among 50 people who responded to a survey last week conducted by research firm Mercury Analytics for The Journal—40%, or 20 of whom said they didn’t post the comment listed under their name, address, phone number and email.
Asked about the Journal findings, a Labor Department spokesman said the agency removes fraudulent comments brought to the agency’s attention. Submitting fraudulent statements or representations to the federal government is a felony.
The Labor Department is the fifth agency identified by The Journal to have posted unauthorized comments on its website. Most federal agencies make it difficult to independently check the authenticity of public comments; only a few publish email addresses along with the comments.
The Journal previously found fraudulent postings under names and email addresses at the Consumer Financial Protection Bureau, Federal Energy Regulatory Commission and Securities and Exchange Commission and the Federal Communications Commission. The Journal’s findings were cited by calls from Congress to delay the repeal of the FCC’s net-neutrality rule.
The fiduciary rule has been fiercely opposed by brokerage firms, insurance companies and mutual fund providers that worry it will make it difficult to sell lucrative financial products that come with high fees. They also are concerned it will add costs through new disclosure requirements and procedures, which in turn will discourage some companies and financial advisers from serving investors with small nest eggs.
The Trump administration’s Labor Department is delaying implementation of most of the rule from Jan. 1 to July 1, 2019 while it reviews the economic impact.
It is unclear who is posting the fraudulent comments. The rule so far has been a boon to the brokerage industry because firms have been pushing customers toward accounts that charge an annual fee on their assets—rather than commissions that can violate the rule. These fee-based accounts typically are more lucrative for the industry.
The Journal survey was sent to 345 people among more than 3,100 comments. The surveys were sent to those identified by The Journal as those who appeared to be unaffiliated with industry or consumer groups or firms. Most of the 345 comments were critical of the fiduciary rule.
Under the Administrative Procedure Act, agencies must take comments under consideration but needn’t pay heed to them. The impact often comes afterward, when the regulated parties appeal to the next administration, the courts or Congress, which can alter a rule or slow its implementation. Failure to consider comments has become a factor in litigation, with judges sometimes forcing an agency to address comments it ignored.
Mercury said the results of the survey indicate “that the practice of submitting comments without the approval of the individuals identified occurs with frequency.”
Some of those surveyed said they liked the comments attributed to them, even though they hadn’t filed them.
A comment attributed to Gina Nakagawa of Winterville, Ga., said: “My husband and I have worked very diligently since an early age.”
In an interview Mrs. Nakagawa, a retired schoolteacher and insurance sales agent, said: “It is not factual…I wish I had said it. But I can’t claim that I wrote it.”
Ralph Litten of Liberty, Mo., is no fan of government regulations. But he says in an interview the comment attributed to him was false and he was unhappy it included his personal information.
“The Federal Government under the Constitution has no authority to define or regulate in any manner how or when I make use of my retirement accounts,” states the comment attributed to Mr. Litten.
In the interview, Mr. Litten said: “The older I get the less and less I trust our federal government, particularly today. It is a quagmire.”