This is yet another example of how the Trump administration is harming consumers rather than helping them.
The U.S. Department of Labor’s Employee Benefits Security Administration has rescinded a 2022 compliance release that discouraged fiduciaries from including cryptocurrency options in 401(k) retirement plans.
Fiduciaries are individuals or organizations that manage money or property on behalf of another person, and they’re legally and ethically required to act in the best interest of that person. The fiduciary must prioritize the client’s needs above their own.
The 2022 guidance directed plan fiduciaries to exercise “extreme care” before adding cryptocurrency to investment menus.
The language deviated from the requirements of the Employee Retirement Income Security Act and marked a departure from the department’s historically neutral, principled-based approach to fiduciary investment decisions, U.S. Secretary of Labor Lori Chavez-DeRemer said in a statement.
“The Biden administration’s department of labor made a choice to put their thumb on the scale,” said Chavez-DeRemer. “We’re rolling back this overreach and making it clear that investment decisions should be made by fiduciaries, not DC bureaucrats.”
He said by rescinding the 2022 guidance, the department reaffirms its neutral stance, neither endorsing, nor disapproving of, plan fiduciaries who conclude that the inclusion of cryptocurrency in a plan’s investment menu is appropriate.
While all investments have risks, cryptocurrency assets are volatile. The potential for high returns can come with considerably high risk.
“It is a horrible mistake to use crypto assets [for retirement plans],” David John, senior strategic policy adviser at the AARP Public Policy Institute, said in a Politico article.
Although I could foresee that that Trump and his cronies would cause great harm to consumers, it’s so unfortunate that voters believed his lies that he would help everyday people.
