(Bloomberg) — President Barack Obama on Monday threw the weight of the White House behind an effort that would make it harder for brokers to push higher-fee mutual funds or other expensive products on people saving for retirement.
The Labor Department plan would require brokers to act in a customer's best interest, a change that could limit the earnings of financial advisers in the handling of Americans' $11 trillion of retirement savings.
The president said the current regulations are out of date, devised in the era when most Americans could count on a traditional pension from employers. Through self-directed retirement accounts, some brokers are skimming significant sums annually from small investors, he said.
"Financial advisers absolutely deserve fair compensation," he said in remarks to the AARP, the nation's biggest lobby for retirees. "But they shouldn't be able to take advantage of their clients."
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