Washington, D.C. counsel Brad Campbell was quoted in a ThinkAdvisor article titled, “U.S. Chamber of Commerce Vows to Use ‘Every Tool’ Against DOL Fiduciary Plan.”
The article discusses how the U.S. Chamber of Commerce is preparing to use everything at their disposal to voice concerns about the Department of Labor’s (DOL) redraft of its rule to amend the definition of ‘fiduciary’ on retirement accounts. The DOL says that prohibited transaction exemptions (PTEs) under its redraft “will be broad and flexible,” but some have expressed concern that the “DOL has [historically] been very narrow, slow and rigid in their PTE approach.”
President Barack Obama recently cited statistics in a report showing that conflicted investment advice likely leads, on average, to 1 percentage point lower annual returns on retirement savings, or a total of $17 billion a year. But Brad says that by the DOL’s own estimates, “lack of access to investment advice costs participants about $100 billion per year in preventable investment mistakes.”
In using the “blunt tool of the prohibited transaction rules — it is difficult for participants to get any advice at all,” Brad said. “This is the risk the [DOL’s] reproposed regulation presents, that it may go so far in trying to eliminate conflicts that it also effectively eliminates access.”
Brad goes on to say that the real-world problem of PTEs in the redraft “dwarfs the ‘back-of-the-envelope’ predictions from the White House about the cost of conflicts.”
To read Brad’s full quotes and the entire article, please click here.