From the White House:
A new report from the President’s Council of Economic Advisers shows that that the current, broken regulatory environment creates misaligned incentives that cost working and middle class families billions of dollars a year-with some individual families losing tens of thousands of dollars of their retirement savings. These incentives cause some Wall Street brokers to encourage working and middle class families to move from low-cost employer plans to IRA accounts that typically entail higher fees-and to steer working and middle class families into higher-cost products within the IRA market. Many advisers currently act as fiduciaries and provide advice in their clients’ best interest, but many others do not. […]
Today, the President called on the Department of Labor to crack down on Wall Street and protect families from conflicted and bad retirement advice. DOL will move forward with a proposed rulemaking that would require retirement advisers to abide by a “fiduciary” standard-putting their clients’ best interest before their own profits.
The president spoke to the AARP on Monday:
… while we’ve come a long way, we’ve got a lot more work to do to make sure that the recovery reaches every single American out there and not just those at the top. That’s what I’ve been calling middle-class economics — the idea that this country does best when everybody does their fair share, and everybody gets a fair shot and everybody is playing by the same set of rules.
And that last part — everybody playing by the same set of rules — is why we passed historic Wall Street reform that put in place smarter, tougher, common-sense rules of the road to protect consumers and to end taxpayer-funded bailouts. […]
Today, we’re going to build on these consumer protections for the middle class by taking a new action to protect hardworking families’ retirement security. Because, in America, after a lifetime of hard work, you should be able to retire with dignity and a sense of security.
And in today’s economy, that’s gotten tougher. Most workers don’t have a traditional pension. A Social Security check often isn’t enough on its own. […]
… the challenge we’ve got is right now, there are no uniform rules of the road that require retirement advisors to act in the best interests of their clients — and that’s hurting millions of working and middle-class families.
(Full transcript: Remarks by the President at the AARP)