That’s precisely why congressional Republicans are insisting on the need to “study” further an Obama administration proposal to make financial advisers more accountable. Under the new rule, savers will gain the right to sue or initiate arbitration against advisers who don’t meet high ethical standards or who fail to disclose conflicts. A vote to delay the rule further is a vote to kill the rule -- that’s how things work in Washington. Billions of dollars in fees will be paid to unscrupulous advisers who aren’t being held to account. The proposal in question, put forward by the Department of Labor, would target the conflicts of interest that can arise when advisers attempt to steer their clients into high-fee, high-risk investments. And to this point, nothing in the law has made them do so. Among America’s middle-class families, who are struggling to save enough for college and retirement and life’s other big-ticket items, this delay is going to cost money.
– Americans trying to save for retirement might be pleased to learn that a new law expected next year will require something that sounds obvious: All financial advisers will be required to work in their clients' best interests. As Vox explains, that is "amazingly" not the case now. Two kinds of advisers currently exist: "Registered investment advisers," who tend to work with the wealthy, are held to high fiduciary standards akin to the standards of doctors and lawyers, and they must indeed work in the best interests of their clients. But the other group, "broker-dealers," are more like salespeople who work on commissions. They're required only to provide "suitable" advice, and there's nothing stopping them from steering their middle-class clients into high-fee products that result in fat commissions for themselves. The Obama administration has been trying to tighten the law—to ensure that all advisers put their clients' interests above their own or their company's—and the spending bill that cleared Congress last week all but ensures it will happen. The financial industry had mounted a "last-minute battle" to kill the provision, but it fell short, reports the Wall Street Journal. As a result, the Labor Department is expected to draft the legislation in January ahead of its implementation later in the year. Proponents say that it will save people big money in their IRAs and 401(k)s, while the industry argues that it will drive many brokers out of business and thus put the price of getting investment advice out of reach for many. At Bloomberg View, meanwhile, former broker and SEC chief Arthur Levitt argues that the change is "long overdue."