US president Barack Obama has thrown his weight behind a Department of Labor proposal to introduce a fiduciary duty for America’s financial advisers and retirement planners.
In his weekly address to the nation on Saturday, President Obama said that ensuring a safe and prosperous retirement income system was a core tenet of “middle class economics”, endorsing calls to boost regulation of advisers.
“Right now, there are no rules of the road,” Mr Obama complained. “Many financial advisers put their clients’ interest first – but some financial advisers get backdoor payments and hidden fees in exchange for steering people into bad investments.
“All told, bad advice that results from these conflicts of interest costs middle-class and working families about $17 billion every year.”
The second-term president said that while many in the US financial advice community support the move, he warned that “some special interests will fight this with everything they’ve got”.
“We’re going to keep pushing for this rule, because it’s the right thing to do for our workers and for our country,” he said.
“The strength of our economy rests on whether hard-working families can not only share in America’s success, but can also contribute to America’s success.”
Dimensional’s global head of adviser services, Dave Butler, will be speaking about the lessons from the US investment advice market at the upcoming ifa Business Strategy Day. For more information please visit http://www.businessstrategyday.com.au/
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