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U.S. Department of Labor

Obama seeks new rules for financial advisers

David Jackson
USA TODAY
President Obama

President Obama will order the Labor Department on Monday to begin developing new rules for financial managers who handle retirement accounts for working Americans.

The goal is to end "hidden fees that hurt consumers and back-door payments that help Wall Street brokers," said a statement from White House senior adviser Brian Deese.

Obama will make the announcement Monday during an afternoon visit to the offices of AARP, according to the White House schedule.

Among guests at the speech: Sen. Elizabeth Warren, D-Mass., an outspoken critic of some Wall Street practices.

White House officials said they want new fiduciary standards that would require financial advisers to put clients' interests ahead of their own. Officials said Americans are losing as much as $17 billion a year in savings because of hidden fees and side deals among brokers.

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While many financial advisers "do not accept backdoor payments or hidden fees," the White House said in a statement that "outdated regulations, loopholes, and fine print make it hard for working and middle-class families to know who they can trust."

The financial industry and congressional Republicans are pushing back on the idea of new rules, saying that existing ones are working well.

Kenneth Bentsen Jr., president and CEO of the Securities Industry and Financial Markets Association, said Obama's proposal "could make it harder to save for retirement by cutting access to affordable advice and limiting options for savers."

The plan "could ultimately raise the cost of saving and hurt all Americans trying to save for retirement, particularly middle-class workers," Bentsen said.

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