FIDUCIARY RULE HEARING: PIABA SAYS PROTECTING RETIREES FROM ADVISOR MISCONDUCT IS NOT A “RADICAL” CONCEPT
According to the Council of Economic Advisers, Conflicted Advice Costs Retirement Savers at Least $17 Billion per Year; “The DOL Rule Would Fix This.”
WASHINGTON, D.C. – FEBRUARY 15, 2024 – Ahead of the hearing before the House Subcommittee on Health, Employment, Labor, and Pensions over the Department of Labor’s (DOL) proposed fiduciary rule, Public Investors Advocate Bar Association (PIABA) President Joseph C. Peiffer released the following statement.
Joseph Peiffer, president of PIABA and founding partner of the law firm Peiffer Wolf Carr Kane Conway & Wise, said: “Let me state the obvious: Expecting financial advisors not to rip off their clients, many of whom are elderly retirees, is not a radical concept.
“Investors’ beliefs that their financial professional have their best interest in mind is due at least in part to these advisors and their trade associations marketing that way. Investment professionals routinely use titles, such as ‘financial advisors,’ ‘financial consultants,’ or ‘wealth managers,’ or even ‘wealth architects.’ One company even claims to put ‘your needs first … focused on fulfilling our promises and doing what’s best for policy owners, not delivering profits for others.’ There are countless examples of marketing just like this.
“Yet, when we attempt to hold these advisors to account for conflicted advice, the advisors and the companies they work for claim that they owe these investors no duty to act in their clients’ best interest. The advisor is just a salesman.
“The DOL rule would fix this. It should not be the case that an advisor can pretend to be a fiduciary to induce an investor to trust them and then pull the rug out in the fine print that disclaims any such duty, which happens routinely. The DOL rule would put a stop to this abusive practice and ensure that investors that have been told to trust their advisor are entitled to non-conflicted advice."
Since its formation in 1990, PIABA has promoted the interests of the public investor in all securities and commodities arbitration forums, while also advocating for public education regarding investment fraud and industry misconduct. Peiffer has represented thousands of investors, and the members of PIABA have collectively represented hundreds of thousands of investors. According to the Council of Economic Advisers, conflicted advice costs retirement savers at least $17 billion per year.
PIABA’s testimony cites dozens of examples of hard-working American retirees who lost their life savings due to conflicted advise. Many were forced to sell their homes or return to the workforce, and some even attempted suicide. Full text of the testimony is available here.
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ABOUT PIABA
Public Investors Advocate Bar Association is an international, not-for-profit, voluntary bar association of lawyers who represent claimants in securities and commodities arbitration proceedings and securities litigation. The mission of PIABA is to promote the interests of the public investor in securities and commodities arbitration, by seeking to protect such investors from abuses in the arbitration process, by seeking to make securities arbitration as just and fair as systemically possible and by educating investors concerning their rights. For more information, go to www.piaba.org.
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