Illinois Treasurer Michael Frerichs today joined U.S. Labor Secretary Thomas Perez at the Center for Economic Progress in the West Loop to discuss the impact of the new Department of Labor conflict of interest rule. The new rule requires investment advisors to be more transparent in the investment advice provided to clients.
“Millions of Americans receive advice from financial advisors on their retirement, but some advice benefits the advisor more than the worker,” said Treasurer Frerichs. People across Illinois – and this country – are struggling to save for their retirement. These everyday citizens trust their advisors, and by enacting this new rule, the Department of Labor has taken a bold step forward in protecting residents in Illinois and across the country from questionable industry practices.”
Prior to the release of the new fiduciary rule, many independent broker-dealers were not required to give advice that was in the best interests of their clients, nor disclose any fees that they may benefit from as a result of guiding their clients to specific investments. The new rule requires most financial advisors to provide their clients unbiased investment advice, or disclose when decisions may not be in the best interest of the client or that investment strategy may benefit the advisor.
“America’s workers and their families deserve and expect retirement investment advice that is in their best-interests,” said Secretary of Labor Thomas E. Perez. “It is important that people understand the protections that our new rule puts into place, and I am pleased to have the opportunity to get the word out here in Illinois.”
The new rule is expected to positively affect millions of Americans saving for their retirement. As the Chairman of the Illinois Secure Choice Board, Illinois’ automatic retirement savings program, and a member of the Illinois State Board of Investments, Frerichs fully supports this new initiative that will bring much needed consumer protection provisions to the financial advisor industry.