'Retirement Rip-Off Counter' underscores impact of Department of Labor's fiduciary rule delay

APR 05, 2017

A counter adding up the $46 million retirement savers are losing daily from a delay of the Department of Labor's fiduciary rule will be projected onto federal buildings in Washington to protest the Trump administration's efforts to postpone the regulation's implementation. In the spirit of the National Debt Clock that shows rising U.S. debt, a "Retirement Rip-Off Counter" will be projected on to the Dept. of Labor and U.S. Chamber of Commerce buildings Wednesday night, according to proponents of the fiduciary rule. The counter seeks to illustrate that Americans are losing $532 a second or $17 billion a year without a mandatory fiduciary rule for retirement advice. Such a regulation was set to take effect on April 10, but has been formally delayed and may be further put off or amended. "The delay is a way for Donald Trump to make a $17 billion gift to Wall Street," said Sen. Elizabeth Warren, D-Mass., in a Washington news briefing on Wednesday. (More: DOL fiduciary rule supporters question agency's quick read of comment letters before sending final delay to OMB) The Department of Labor released a final rule on Tuesday delaying the implementation of its fiduciary duty regulation by two months, providing a new applicability date of June 9. It's set to be published in the Federal Register on Friday and takes effect immediately. Mr. Trump has asked the agency to modify or repeal the rule if it will limit investors' access to financial advice or boost litigation for firms. Rule opponents like the Securities Industry and Financial Markets Association, which represents brokers, and the Investment Company Institute, which represents mutual funds, have argued that the regulation is too complex, costly, and will restrict access to advice. The dollar counter introduced on Wednesday is based on an estimate from the prior administration's White House Council of Economic Advisors two years ago that estimated Americans lose about $17 billion a year – or $46.5 million per day – from receiving conflicted advice in their retirement accounts. It was started on Feb. 3, the day when President Trump first said he would target the fiduciary rule for delay and can be found at SaveOurRetirement.com. It shows so far Americans have lost $2.9 billion. (More: Savvy RIAs are waving the fiduciary flag) The media event included Vietnam veteran Stephen Wingate, 69, who described advice he received from his broker in Illinois on his retirement accounts that cost him $147,000, more than half of his initial investment. He had told the broker he wanted conservative investments, but was invested in non-traded real estate investment trusts. "Never in my wildest dreams did I think someone who was managing my retirement savings could be legally allowed to put his interests ahead of mine," said Mr. Wingate, who has filed a FINRA arbitration claim against the broker that is due to be heard in November. Opponents of the fiduciary rule says that the current two-month delay is insufficient. The DOL needs to act by June 9 to further delay or change the rule or "it risks creating significant market disruptions that will reduce retirement savers' access to retirement products, services, and related financial information and advice," the ICI said in a statement on Wednesday.

Latest News

Texas man says SEC and fund could make him pay twice
Texas man says SEC and fund could make him pay twice

A $141M judgment and a federal asset freeze collide over one shrinking pool

Osaic executives Kristy Britt and Greg Cornick to leave
Osaic executives Kristy Britt and Greg Cornick to leave

The firm's CFO and EVP of Wealth Management Solutions are the latest executives to exit the broker-dealer.

Estate planning becomes a client retention issue for financial advisors, survey finds
Estate planning becomes a client retention issue for financial advisors, survey finds

Clients are saying they would consider switching advisors if another professional offered estate planning services, according to a new Trust & Will survey.

Candidly adds AI agents for Trump Accounts, workplace benefits
Candidly adds AI agents for Trump Accounts, workplace benefits

CEO Laurel Taylor says the fintech's composable AI stack helps workers optimize dollars across Trump Accounts, 529s, 401(k)s, and other employee benefits.

BMO adds three advisors in Dallas amid Y'all Street wealth boom
BMO adds three advisors in Dallas amid Y'all Street wealth boom

The bank has swiped three private banking veterans from BNY as the city climbs the ranks of America's fastest-growing wealth hubs.

SPONSORED Who builds the income when the pension disappears?

Dan Biagini of American Equity says the steady decline of pensions, longer lifespans and a reset in interest rates are rewriting how advisors build retirement income

SPONSORED Why direct indexing stopped being optional

Direct indexing is on pace to outgrow ETFs and mutual funds. Northern Trust's Ken Lassner explains why the advisors who get it wish they had started sooner.