Trump will allow financial adviser rule to go forward
WASHINGTON - The Trump administration is allowing to go forward an Obama-era rule that puts stricter requirements on professionals who advise retirement savers on their investments. But it’s leaving open the possibility that deep changes to the rule will still be made.
Wall Street and Republican lawmakers have been pushing against the socalled “fiduciary” rule, which requires that financial pros who charge commissions put their clients’ best interests first when advising them on retirement investments. President Donald Trump in February told the Labor Department to delay implementing the rule, due to be phased in starting June 9.
But Trump’s new labor secretary, Alexander Acosta, said Tuesday the department has decided not to delay the rule while it seeks public input on how to change it.
“Respect for the rule of law leads us to the conclusion that this (June 9) date cannot be postponed,” Acosta wrote in an oped piece in The Wall Street Journal. “Trust in Americans’ ability to decide what is best for them and their families leads us to the conclusion that we should seek public comment on how to revise this rule.”
Americans have about $14 trillion in retirement savings — in 401(k) retirement accounts, other defined-contribution plans such as federal employees’ plans and in individual retirement accounts.
Supporters of the fiduciary rule see it as key to guaranteeing the integrity of the advice they get on where to invest it. The aim of the rule, put in by the Obama administration about a year ago, was to prevent financial advisers from steering clients toward investments with higher commissions and fees that can chip away at retirement savings.
Investors would save about $4 billion annually under the rule, according to Obama administration estimates.
The financial industry, on the other hand, has argued that the rule would limit retirees’ investment choices by forcing advisers to steer them to lowrisk options.
Consumer advocates greeted Acosta’s announcement, which appeared as a departure from a string of moves in recent months by the administration and Republican lawmakers to ease regulations.
The move was “a great victory for Americans saving for retirement,” said Dennis Kelleher, the president of Better Markets, a group that advocates for stricter regulation.
Pamela Banks, senior policy counsel for Consumers Union, urged the Labor Department “to resist industry-led efforts to diminish or weaken the rule and the important protections it provides.”
Experts say problems sometimes arise when people who are retiring “roll over” their employer-based 401(k) assets into IRAs. Brokers may persuade them to put those assets into variable annuities, real estate investment trusts or other investments that can be risky or otherwise not in the client’s best interest.
Variable annuities can provide higher returns from the stocks or bonds they are tied to, but they are riskier than fixed annuities, which pay a set income to an investor for life.
SAN FRANCISCO - Google already monitors online shopping — and now it’s keeping an eye on physical stores to try to sell more digital advertising.
The internet company said Tuesday that a new tool will track how much money people spend in merchants’ brick-and-mortar stores after clicking on their digital ads.
The analysis will be done by matching the combined ad clicks of people who are logged into Google services with their collective purchases on credit and debit cards. Google says it won’t be able to examine the specific items purchased or how much a specific individual spent.
But even aggregated data can sometimes be converted back to data that can identify individuals, said Larry Ponemon, chairman of the Ponemon Institute privacy research firm.
Google says it has access to roughly 70 percent of U.S. credit and debit card sales through partnerships with other companies that track that data.
By matching ad clicks with this data, Google says it can automatically inform merchants when their digital ads translate into sales at a brick-and-mortar store.
Previously, if people clicked on an ad without buying anything online, an advertiser might conclude that the ad was a waste of money.
If the program works, it could help persuade merchants to boost their digital marketing budgets.
The data add to the digital dossiers that Google has compiled on users of its search engine and other services, including Gmail, YouTube and Android.
Sridhar Ramaswamy, Google’s senior vice president of ads and commerce, said the new tracking system was created in consultation with “incredibly smart people” to ensure it’s not invasive. He described the program as “secure and privacy safe.”
But Ponemon said that even if Google has good intentions now, companies and governments in the future might not.
The kinds of data that Google is collecting also could become an inviting target for hackers, said Miro Copic, a marketing professor at San Diego State University.
“The privacy implications of this are pretty massive, so Google needs to tread very carefully,” Copic said.