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Witness says brokers try to pass themselves off as fiduciaries

Testifying on the DOLs fiduciary proposal, the head of the Public Investors Arbitration Bar Association told how blurry the line between fiduciary and broker has become, detailing horror stories of retiree investments lost.

By Nick Thornton | Updated on August 14, 2015

At the heart of the Department of Labor’s effort to finalize a new rule requiring advisors to act as fiduciaries to most 401(k) plans and IRAs is the need to clarify which entities in the financial services world are actual fiduciaries, and which merely imply that they are.

That line has been blurred, argued Labor Secretary Thomas Perez, in testimony to Congress defending the Department’s effort to post a rule by the end of the Obama Administration, in spite of wide-ranging criticism from stakeholders, and a growing number of lawmakers, that the rule, as proposed, would have massive unintentional consequences for small workplace retirement accounts and IRAs.

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