Biden unveils new rules on U.S. retirement savings
WASHINGTON, Feb 26 (Reuters) - Vice President Joe Biden on Friday proposed new rules to help protect U.S. workers' retirement savings as part of a broader government effort to bolster the finances of middle class voters.
With President Barack Obama's popularity ratings down in a congressional election year, his administration has sought to focus more on middle-class voters' concerns about high unemployment, the ailing economy and their troubled finances.
Biden, who heads a year-old panel assigned to improve middle-class living standards, announced new Labor Department regulations on workers' retirement savings at an event to release the annual report of his middle-class task force.
The new safeguards, which the White House says will affect tens of millions of workers, are aimed at protecting employees and their 401(k) and IRA retirement savings plans from financial advisers' potential conflicts of interest.
Retirement investment advisers and money managers would only be allowed to give advice if they did not get any commission for steering workers into funds with which they are affiliated, or if their advice was based on a computer model certified to be unbiased by independent experts.
"Some kinds of investments are more profitable for financial institutions than others, but those investments may not be the best ones for workers," the White House said in a briefing document on the proposed rule changes.
"As a result, if investment advisers get a commission or other compensation for steering workers into investment options with high fees and expenses, they face conflicts of interest that can undermine the reliability of their advice.