WASHINGTON, D.C.— Better Markets’ Legal Director and Securities Specialist Steve Hall and Christine Lazaro, Professor of Clinical Legal Education and Director of the Securities Arbitration Clinic at St. John’s University School of Law, highlight the urgent need for the U.S. Department of Labor to strengthen protections for retirement investors and require financial advisors always to act in the best interests of their clients. Below are excerpts from the Financial Planning Op-Ed, which can be read in full here.
“All investors need and expect financial advice that’s in their best interest. That’s especially true of retirement savers who depend on their investments to live a safe and secure retirement. But the sad truth is that many advisors are recommending investments that line their own pockets with huge fees and commissions but saddle their clients with low returns and high risks.
“The Department of Labor (DOL) can solve this problem, and last year it announced its intention to do just that with another round of rulemaking. It should move ahead without any further delay, and here’s why.
“The industry often resorts to scare tactics, warning that retirement investors will be unable to get any investment advice if the industry has to adhere to true fiduciary standards. However, the threat that investors will be left in the cold is simply not true. There are many advisors who are willing to do the right thing and place their clients’ interests first. They still manage to earn an excellent living, and the investors get trustworthy advice.
“Retirement investors are entitled to the protections of ERISA. When it adopted that law, Congress determined that retirement funds deserved special protections. When workers set aside money to provide for themselves in retirement, they should not have to worry about getting fleeced by those whom they seek out for advice and guidance. It is time for the DOL to regulate those it was always intended to regulate, to close the loopholes, and to beef up the protections that retirement investors expect and deserve under the law.”
Better Markets is a non-profit, non-partisan, and independent organization founded in the wake of the 2008 financial crisis to promote the public interest in the financial markets, support the financial reform of Wall Street and make our financial system work for all Americans again. Better Markets works with allies—including many in finance—to promote pro-market, pro-business and pro-growth policies that help build a stronger, safer financial system that protects and promotes Americans’ jobs, savings, retirements and more. To learn more, visit www.bettermarkets.org.
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