Vanguard Group Chief Executive Bill McNabb said on Thursday he was encouraged by the U.S. Department of Labor’s steps to make new rules on the advice brokers provide on retirement savings “more workable.”
“We are encouraged that the DOL has taken important steps to establish meaningful protections for retirement investors while making the final rule more workable,” McNabb said in a statement posted online.
The Obama administration on Wednesday unveiled its final version of a retirement advice rule aimed at ensuring that broker-dealers put their clients’ interests ahead of their own profits, though it was softened in response to industry complaints.
Vanguard, a major manager of retirement investments that oversees more than $3 trillion in assets, had criticized an earlier version of the proposal as being applied too broadly to its activities and to situations in which investors would not reasonably expect that they were receiving investment advice.
Yet Vanguard said the new rule makes disclosure and contract requirements “more practical and easier to follow.”
“All of the effort within the industry to improve the DOL proposal appears to have produced positive results,” according to John Schadl, a member of the company’s legal department, according to a statement also posted online.
The company praised the government’s efforts to align its rules better with existing standards laid out by other regulatory bodies, although Vanguard said “the DOL could have done more to harmonize these standards.”
The Valley Forge, Pennsylvania-based company said it has not fully reviewed the 1,023 pages of rules the department released.
“It is almost certain that we will find provisions of the new rule that will adversely affect some within the industry,” Schadl said in the statement.
(Reporting by Trevor Hunnicutt; Editing by Steve Orlofsky and Dan Grebler)