“A broad-based coalition of labor unions and consumer protection groups has reiterated its support for the U.S. Department of Labor (DOL) to update, strengthen and clarify rules around advice provided to workers saving through retirement plans.

“The DOL earlier this year delayed proposing changes to the rule governing Employee Retirement Income Security Act (ERISA) plans until January.”

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“Updating fiduciary responsibilities around ERISA plans are long overdue, said Dennis Kelleher, president and chief executive officer of Better Markets, a nonprofit organization that promotes the public interest in financial reform and is a signatory of the letter.

“Kelleher, who was a panelist in a series of conferences to bring attention to fiduciary standards of care, said that tolerating a 40-year-old rule governing the duty under which people obtain investment advice is “quite remarkable.

“Fiduciary responsibilities spelled out in ERISA refer to vague concepts of prudence and responsibility. The law allows for conflicts of interest and hidden fees, which in many instances people would find unacceptable today, Kelleher said.

“It’s as if Gerald R. Ford were still president,” he said.

“President Ford signed ERISA into law on Labor Day 1974 and the ERISA rules took effect in 1975.

“In 1974, consumers were buying vinyl records in retail stores and defined contribution retirement products such as individual retirement accounts had just been authorized — the 401(k) didn’t even exist, Kelleher said.”

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Read the full InsuranceNewsNet article by Cyril Tuohy here