New GAO Audio Catches 401(k) Provider Engaging in Deceptive Sales Practices


    ethicsJust as the PBS Frontline documentary (“The retirement Gamble” which aired April 23, 2013) has significantly ruffled the 401(k) industry, a new audio and Government Accountability Office (GAO) report has an unnamed 401(k) provider on tape as trying to convince a caller about the benefits of rolling over their 401(k) into the unnamed 401(k) company’s IRA program.

    The audio is instructive about the unethical and inaccurate information being provided by at least one 401(K) provider.  But the GAO investigation has prompted two senators and one Congressman (all of them Democrats) to call on the Department of Labor) DOL and Treasury to act on the DOL’s anti-consumer fraud program.

    Here is the audio from the You Tube introduction to the GAO audio.  This makes for very interesting listening, especially for people in the 401(k) industry. The calls from the three Congresmen again make the DOL (and not the SEC) the point agency in protecting the rights of the nation’s individual investors.

    “America’s workers are often presented with false and misleading information regarding fees and their options on what to do with their 401(k) assets when they leave an employer, according to a Government Accountability Office (GAO) investigation released by Rep. George Miller (D-CA), Sen. Tom Harkin (D-IA), Sen. Bill Nelson (D-FL).

    “Following the release of the report, Miller, Harkin, and Nelson called on the Departments of Labor (DOL) and Treasury to act on GAO’s recommendations, including protecting consumers from deceptive marketing materials disguised as advice, establishing uniform standards and model notices to assist 401(k) accountholders in making better-educated decisions on their retirement savings, ensuring the full disclosure of Individual Retirement Account (IRA) fees, and encouraging people to keep their retirement savings in the 401(k) system. The leaders pledged to work on legislation in Congress to address these goals, if need be.

    “This video demonstrates examples of 401(k) service providers giving a potential participant guidance favoring IRAs.”

    Video and audio posted April 3, 2013

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    Chuck Epstein has managed marketing communications and public relations departments for major global financial institutions and participated in the launch of industry-changing financial products. He also has written by-lined articles for over 50 publications, five books and served as editor and publisher of nation’s first newsletter on the topic of using the PC for personal investing and trading. (“Investing Online, 1994-1999). He also is a marketing consultant, writer and speaker on topics related to investor protection and opportunities in the very dynamic cannabis industry. He has held senior-level marketing, PR and communications positions at the New York Futures Exchange, Chicago Mercantile Exchange, Lind-Waldock, Zacks Investment Research, Russell Investments and Principal Financial. He has won national awards from the Mutual Fund Education Alliance (MFEA) and his web site,, was named best small blog in 2009 by the Society of American Business Editors and Writers (SABEW).


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