'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

Stratos Wealth Holdings closes 11 acquisitions in push for advisory scale
Stratos Wealth Holdings closes 11 acquisitions in push for advisory scale

RIA aggregator adds $4.8 billion in client assets across seven states as demand grows for alternatives to traditional succession models.

Beyond wealth management: Why the future of advice is becoming more human
Beyond wealth management: Why the future of advice is becoming more human

As technical expertise becomes increasingly commoditized, advisors who can integrate strategy, relationships, and specialized expertise into a cohesive client experience will define the next era of wealth management

Shareholder sues FS KKR Capital board, alleges NAV and dividend cover-up
Shareholder sues FS KKR Capital board, alleges NAV and dividend cover-up

Shareholder targets FS KKR Capital's directors over alleged portfolio valuation and dividend missteps.

UBS loses $1.2 million arbitration claim linked to variable annuities and margin
UBS loses $1.2 million arbitration claim linked to variable annuities and margin

UBS has a history of costly litigation stemming from the sale of volatile investment products.

'We are monitoring the situation,' SEC says of private funds
'We are monitoring the situation,' SEC says of private funds

New director David Woodcock puts firms on notice over fees, conflicts, and liquidity risk as private credit shows signs of stress.

SPONSORED Beyond wealth management: Why the future of advice is becoming more human

As technical expertise becomes increasingly commoditized, advisors who can integrate strategy, relationships, and specialized expertise into a cohesive client experience will define the next era of wealth management

SPONSORED Durability over scale: What actually defines a great advisory firm

Growth may get the headlines, but in my experience, longevity is earned through structure, culture, and discipline