Miller Slams DoL Advice Proposal
August 21, 2008 (PLANSPONSOR.com) - The Labor
Department's advice proposal drew a quick - and harsh -
assessment from Congressman George Miller
"For far too long, the rules of the financial
services industry have been tilted in the interests of
companies and consultants, not the millions of American
workers who are deeply worried about saving enough for a
secure retirement," Miller said in a statement.
Miller, the chairman of the House Education and Labor
Committee, said that the two rules proposed by the U.S.
Department of Labor could further undermine retirement
savings plans that millions of American workers depend
The components of the proposals clarify the Pension
Protection Act (PPA) exemption for investment advice,
according to the Department of Labor (DoL) (see
Investment Advice Regulations
The PPA had added an exemption that allowed participants of
401(k) plans and IRAs to receive investment advice by using
an unbiased computer model or an adviser compensated on a
"level-fee" basis (see
An Advice Road
After receiving comments since December 2006 about
clarifying computer models and developing the model for the
disclosure of adviser fees, the DoL issued the new
Bradford P. Campbell, assistant secretary of labor for
Employee Benefits Security Administration at the DoL, said
the proposals were part of the continued efforts to protect
participants from receiving investment advice from
individuals with a vested interest in products.
That wasn't how Miller saw it, however.
"For far too long, the rules of the financial services
industry have been tilted in the interests of companies and
consultants, not the millions of American workers who are
deeply worried about saving enough for a secure retirement.
Now, the Bush administration is proposing to further tip
the scales towards special interests by opening the door to
conflicts of interest among the very consultants purporting
to offer unbiased investment advice, and potentially
allowing companies to reap windfall profits at the expense
of America's workers," he said in a
House Republican Leader John Boehner (R-Ohio), a
long-time proponent of the type of advice legislation that
was finally incorporated in the PPA, saw it quite
differently, praising the Department of Labor (DOL) for
taking a "major step in implementing key investment advice
reforms to help American workers make the most of their
"The Pension Protection Act included key reforms to give
workers access to high-quality, professional investment
advice to help them manage their retirement savings more
wisely," Boehner said in a
"Today's action by the Department of Labor is a major step
toward giving workers just that."
Miller didn't just express his dissatisfaction with the
proposal, he said they were "nothing less than a boon for
Wall Street and corporate executives," and urged the DoL to
"immediately withdraw these harmful proposals."
In a statement he added, ""In its final months in
office, this administration has developed a disgraceful
pattern of sneaking in last-minute regulatory changes at
the behest of special interests. At a time when Americans'
retirement accounts have already been pummeled by the
nation's economic downturn, it is deeply extremely
troubling that the department is trying to push through
proposals that would further jeopardize workers'
Nevin E. Adams