Earlier this month, Better Markets joined more than 30 other prominent public interest groups in crafting and submitting a comment letter to the Department of Labor that called for further guidance and rulemaking to rein in adviser conflicts of interest that cost tens of millions of retirees tens of billions of dollars every year.
Although the rule went into effect in February, the DOL signaled that its work on the issue is not done and issued its request for comment.
In our letter, we noted that we “strongly opposed the DOL’s adoption last year of its ‘Improving Investment Advice for Worker & Retirees’ exemption because of our concern that it would leave retirement investors dangerously exposed to conflicted advice.” We urged the department to narrow loopholes in the rule; strengthen the “best interest standard” and make the disclosure obligations more meaningful, among other necessary steps.
Why it matters? The conflicts-of-interest rule that the DOL finalized last year was too weak to adequately protect Americans’ hard-earned retirement savings from advisers who continue to enrich themselves by dispensing bad investment advice to their clients. Much more needs to be done.
What we said. We’re optimistic because when the DOL issued its recent guidance, it clearly signaled its intention to engage in rulemaking to address these continuing risks to retirement savers. Only with a robust set of rule improvements, undertaken without delay, will retirement savers be adequately protected from the advisers who still siphon away their clients’ hard-earned savings.
Bottom line. Now that the DOL is under new leadership, there is a real opportunity to address continuing risks to retirement savers by fixing the weak rule that includes numerous loopholes.
Read more in our press release.