International
Union of Bricklayers
and Allied Craftworkers

International

‘SAO yAOMIIEID

James Boland
President

July 21, 2015

Via Federal eRulemaking Portal: www.regulations.gov

Office of Regulations and Interpretations

Employee Benefits Security Administration, Room N-5655
U.S. Department of Labor

200 Constitution Avenue NW

Washington, DC 20210

Attn: Conflict of Interest Rule

Re: Definition of Fiduciary; Conflict of Interest Rule-Retirement Investment Advice
and Related Proposed Prohibited Transaction Exemptions, Docket Number EBSA-
2010-0050-0205; RIN 1210-AB32

To Whom It May Concern:

Please accept this letter on behalf of the International Union of Bricklayers and
Allied Craftworkers (“BAC”), its 120 U.S. affiliates and its members in response to
“Definition of Fiduciary; Conflict of Interest Rule-Retirement Investment Advice and
Related Proposed Prohibited Transaction Exemptions.” BAC is the oldest continuous
union in the United States and represents nearly 80,000 members working in the
masonry industry.

BAC members spend their lifetimes conserving part of their hard-earned wages
to fund secure retirements for themselves and their families. For the most part, these
retirements are in the form of defined benefit pensions, but they are also increasingly
participating in 401(k) plans. In those plans, they, as most Americans, are more
dependent than ever on advice from financial advisors to help them make complex
retirement investment decisions to navigate through the intricacies of the financial
market. These financial advisors are often permitted to recommend investments that
come with high fees, poor returns, and even substantial risks because they have no
fiduciary duty to act in the best interest of their clients.

620 F Street, NW - Washington, DC 20004 * Phone: 202-383-3195 - Fax: 202-661-8984 - www.bacweb.org


Unfortunately, because of ambiguities that exist in the statutory definition of
fiduciary under the Employee Retirement Income Security Act (ERISA), many of the
financial advisors that give critical retirement investment advice are legally allowed to
place their own financial interests ahead of the interests of their customers. This conflict
of interest can leave scores of unsuspecting workers and retirees to follow questionable
advice, yet leaves no accountability for the advisors who induce them to poorly invest
their saved earnings. The current regulatory scheme leaves both workers and retirees
vulnerable to follow misleading advice that could deplete their savings and threaten their
prospects for retirement.

The proposed rule by the Department of Labor (DOL) entitled “Definition of
Fiduciary; Conflict of Interest Rule-Retirement Investment Advice and Related Proposed
Prohibited Transaction Exemptions,” however, will correct this loophole by sharpening
the statutory language to define exactly what professional advice is governed under a
fiduciary standard of care. Under the current regulatory scheme of ERISA, enacted over
40 years ago, those giving financial investment recommendations can avoid fiduciary
obligations under the outdated five-part test. The newly proposed rule supplants this
five-part test and simply and clearly assigns fiduciary status to those who earn
compensation for providing a recommendation that is either individualized or specifically
directed to an employee retirement plan, a plan participant, an Individual Retirement
Account (IRA), or an IRA owner. This rule change will guarantee that all important
financial investment advice regarding retirement assets is given in the best interests of
the client.

Updating this standard will generate better investment outcomes for retirement
savers and provide concrete benefits to millions of workers, investors, and retirees at no
cost to the US treasury and taxpayers. The proposed rule will protect those nearing
retirement and those already in retirement from accepting potentially harmful advice
from professionals not obligated to act in their best interests. Particularly, the proposed
rule will provide protection to low and middle-income Americans who are more
vulnerable to accepting poor investment advice that could deplete their life savings.
Ultimately, this rule advances the underlying purpose for which ERISA was enacted, to
protect the retirement interests of Americans. For the foregoing reasons, BAC strongly
endorses this proposed rule and urges its adoption.

Sincerely,

a ae

James Boland
President