Some financial service firms are "freely acknowledging" they stand to make more money servicing fewer clients as a result of the Labor Department's fiduciary rule, which is expected to result in more retirement investors being moved to fee-based advisory accounts from commission-based brokerage accounts.
Rep. Bill Huizenga, R-MI, offered that claim during a House Financial Services subcommittee hearing exploring the rule's impact on capital markets.
Huizenga claimed that representatives from several firms have told him that fee-based advisory accounts, which charge a percentage of assets annually and are recognized as being favored by the rule, will result in increased profits. The congressman did not identify those firms by name.
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Nick Thornton
Nick Thornton is a financial writer covering retirement and health care issues for BenefitsPRO and ALM Media. He greatly enjoys learning from the vast minds in the legal, academic, advisory and money management communities when covering the retirement space. He's also written on international marketing trends, financial institution risk management, defense and energy issues, the restaurant industry in New York City, surfing, cigars, rum, travel, and fishing. When not writing, he's pushing into some land or water.
