T. Rowe Price is expected at a hearing on Friday to ask the Labor Department to let investment advisers actively managing pension funds swap securities among different investment portfolios. Federal law prohibits pension fund advisers from representing both the seller and the buyer in securities trades because of fears of client favoritism. In December the Labor Department proposed letting passive and quantitative money managers "cross-trade’’ among their clients’ portfolios, but did not grant similar permission for active investment managers.
‘‘Retirement plan clients are requesting it and can’t understand why their discretionary managers can’t cross-trade and why they can’t benefit from the reduced commission costs that non-ERISA clients can benefit from,’’ said David M. Abbey, vice president and associate legal counsel at the Baltimore mutual fund firm, which also manages $16 billion in pension assets in separate accounts.
T. Rowe Price is expected to ask the Labor Department to give pension advisers a broad-based exemption similar to a securities rule that permits cross-trading for non-pension advisers and mutual funds.
