White House Wants To Crack Down On 401(K) Fees

Over the objections of Wall Street and some financial regulators, the White House announced Monday that it plans to move ahead with a new rule that will hold investment brokers to a higher standard, requiring by law that they act in the best interests of their clients.

The so-called fiduciary duty rule would prevent certain brokers from considering their own profits when they steer clients into particular investments, likely cutting into the fees those brokers receive when they advise clients on 401(k)s and other retirement accounts. White House officials said on a conference call with reporters that in the coming months, the Labor Department will release a proposed rule that lays out the full details of the plan.

“If you have a serious illness, you don’t want your doctor telling you what’s suitable for you — you want him telling you what’s best for you,” Perez said in explaining the rationale behind the rule. “This potential for conflict of interest … isn’t right. Consumers deserve to know their advisor is working for them.”

The Huffington Post