The Department of Labor today proposed requiring 401(k) plan investment advisers to disclose their fees and show that the computer models used to offer advice to participants are objective and unbiased, according to a Labor Department news release.
The proposal would prevent 401(k) plans from slanting advice that would benefit advisers at the expense of participants.
Separately, the Labor Department announced it will require multiemployer retirement plans to disclose funding and other financial information to its participants, allowing for day-to-day monitoring of the financial condition and operations of retirement investments. That rule goes into effect in April.
Both rules were in a report of the White House Middle Class Task Force, which was released by Vice President Joe Biden at the White House today.
“All too often, the worst-performing products with the highest fees and best commissions for financial service firms have been pushed by Wall Street on our nation's workers,” according to a statement from Reps. George Miller, D-Calif., chairman of the House Education and Labor Committee, and Rob Andrews, D-N.J., chairman of the pensions subcommittee. “We hope that this proposal will help to ensure that investment advice is based on what is best for a family's long-term retirement security, not the investment adviser's commissions.”