How picky is picky? Advice regs an unknown – Investment News

A hybrid of these regulatory offerings could be just want investment-advice-hungry 401(k) participants ordered, but we will have to wait and see.

“The [Bush] rule that was pulled expanded conflicts of interest, to the detriment of consumers,” said David Certner, legislative-policy director of the AARP, an influential foe of the Bush rule. “We would urge that the department come back with a new regulation that limits conflicts. You don’t want the person who is giving you the advice to have a financial interest in the advice, which the Bush rule would have allowed.”

“The Bush administration proposal was a special-interest giveaway to Wall Street at the expense of workers,” House Education and Labor Committee Chairman George Miller, D-Calif., said in a statement. “It would have opened the door to unscrupulous advisers to make recommendations based on their financial stake, and not in the best interests of workers. The Obama administration was right to pull this misguided proposal, and we hope they move forward on protections to ensure that investment advice given to workers [is] in the workers’ best interests.”

But Bradford P. Campbell, who headed the Labor Department’s EBSA when the Bush rules were developed, said it is a “shame” that the Obama administration agency has jettisoned the entire rule instead of just the parts it found to be most offensive.

“It is one thing for a new administration to have a policy disagreement with its predecessor about a portion of a regulation,” Mr. Campbell, an attorney with the law firm Schiff Hardin LLP, said in an interview. “It is another thing entirely to throw the baby out with the bath water.”

How picky is picky? Advice regs an unknown – Investment News
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