Left-leaning Economic Policy Institute is banging the fiduciary drum, claiming further delays in full implementation of the DOL’s Conflict of Interest Rule will cost retirement plan participants $7.3 billion over 30 years.
This is on top of the $7.6 billion it estimates delays already put in place by the Trump Administration will cost participants over the same period.
The numbers were included in comments submitted by EPI Policy Director Heidi Shierholz in response to a Department of Labor Request for Information about a potential delay in the full implementation of the fiduciary rule.
“The only beneficiary of President Trump’s move to delay this rule is the financial services industry, which wants to continue to take advantage of retirement savers for as long as possible,” said Shierholz. “Working people trying to save for retirement need to be able to invest their hard-earned savings without being fleeced.”
She claims that before the rule went into partial effect in June, it was legal, in many cases, for financial salespeople to recommend higher-cost investment products that provide them with a higher commission but provide lower returns to their clients.
If fully implemented and enforced, the fiduciary rule will eliminate what she calls “loopholes” that made providing this kind of conflicted advice a widespread practice among financial advisers.
“The Trump administration claims that delaying the rule will give it time to determine whether the rule would adversely affect the ability of Americans to gain access to retirement advice,” which she called a “thinly-veiled tactic to kill or weaken the rule and allow the financial industry to continue taking advantage of retirement savers.”
“We have a retirement crisis in this country. We need an America where working people can get advice on how to invest what they’ve earned without being taken advantage of by the financial professionals they go to for help,” Shierholz concluded.
With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots.
