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The AFL-CIO welcomes President Obama’s announcement that his Administration is taking the first step towards closing loopholes that allow Wall Street firms that create and distribute investment products to elevate a financial adviser's paycheck over the best interests of workers and retirees.
These new retirement investment advice protections are long overdue. The current regulations are nearly 40 years old, from a bygone era that predates 401(k) plans and most Individual Retirement Accounts (IRAs). Their loopholes leave tens of millions of workers and retirees at risk.
Americans are worried about having a secure retirement, especially as they face increasingly complicated choices about how to save and invest their hard-earned dollars. When they turn to professional financial advisers to help navigate their complex choices, they should be able to have confidence that the advice they get is in their best interest – and not driven by sales commissions and high fees that can deplete their retirement accounts like a slow leak in a tire.
We have a way to go, however, before this rule is law, and Wall Street companies will make every attempt to keep it from becoming final. The AFL-CIO will do everything it can to fight back. We look forward to a final rule that will provide a strong set of protections for American workers and retirees to shield them from conflicts of interest wherever they have their retirement money, whether it is in a 401(k), IRA, or pension.
Contact: Josh Goldstein (202) 637-5018