Betterment’s latest ad campaign has attracted attention from Senator Elizabeth Warren.
The Democratic Senator from Massachusetts, known for her aggressive rhetoric against the financial services industry, took to social media on Tuesday to announce her support of Betterment CEO Jon Stein and his defense of the Department of Labor’s fiduciary rule.
“I agree with CEO Stein: undercutting the rule would be bad for working families—and bad for the many businesses who have already complied with the new rule, that would compete against the ones that won’t,” Warren wrote on her Facebook page.
On Monday, Betterment purchased a full-page ad in the Wall Street Journal to publish a letter from Stein to Donald Trump, asking the President-elect to keep the fiduciary rule intact:
“When investors give their money to an investment firm, they expect that firm to act in their best interest.
But investing can be made intentionally complicated, and salesmen are clever. Left to its own devices, the investment industry for decades sold bad products to Americans.
Many firms make hidden money selling funds and investments. They charge confusing fees that investors can’t see. They push investments that are in their best interest—not in the best interests of investors.
The Dept. of Labor’s fiduciary rule, which protects Americans from these bad practices, is under attack. This isn’t your average lobbying against regulation. It’s an attack against the biggest benefit for retirement savers in 40 years—since the deregulation of broker commissions brought down costs for everyone, and since the introduction of the 401(k).”
Betterment has been a vocal proponent of the fiduciary rule for some time, publicly stating its support last year. The robo advisor also took out an ad in the New York Times’ Sunday edition that questioned the trustworthiness of some investment managers.
Trump has not been clear about his position on the fiduciary rule, but many members of his team have been prominent critics. Anthony Scaramucci, a hedge fund manager and part of Trump’s transition team, said the rule would be repealed under a Trump presidency.
Warren clearly feels the rule is threatened.
“Earlier this year, the Department of Labor finalized a new rule to protect the retirement savings of hardworking Americans from hidden fees, kickbacks and other investment adviser conflicts of interest. And it’s working: dozens of firms have dramatically reduced prices on their investment products, benefiting consumers as well as advisers who want to do right by their clients,” Warren said in her Facebook post supporting Stein. "But Donald Trump and the Republican Congress want to overturn this rule, leaving you to the tender mercies of the big finance companies.“
