Pending legislation that includes provisions to enhance fee disclosure for defined contribution plans would be “both redundant and counterproductive,” according to the mutual fund industry’s Investment Company Institute.
In a May 21 letter to House leaders, ICI says the fee-disclosure provisions in the American Jobs and Closing Tax Loopholes Act of 2010 would pre-empt a long-proposed effort by the Department of Labor to adopt final regulations enhancing DC plans’ fee and compensation disclosure requirements.
The bill’s provisions “will simply delay implementation of disclosure reform because regulators will need to interpret the new provisions and draft proposals to implement them,” Paul Schott Stevens, ICI president and CEO, wrote in the letter to House leaders.
In an e-mail response to questions, Aaron Albright, a spokesman for Rep. George Miller, D-Calif., a key sponsor of fee-disclosure legislation, wrote the ICI argument “sounds like the industry’s excuse du jour against letting consumers know how much Wall Street is taking from their retirement savings. While we look forward to seeing what the department comes up with, codifying disclosure requirements into law will provide consumers stronger protections.”