It's the rainy season in Washington, D.C., as legislative proposals designed to protect retirement plan assets and better advise employees come pouring in.
Among the federal lawmakers anxious to rectify wrongs exposed by Enron are the architects of last year's pension reform legislation, Reps. Rob Portman (R-Ohio) and Ben Cardin (D-Md.). The dynamic duo has introduced a bill that, like President Bush's proposals, would allow employees to sell stock received through matching contributions after working three years for a company. It also would enable workers to sell stock received as non- elective contributions, as well as require employers to warn of blackout periods at least three weeks in advance and to educate employees about the advantages of diversification at least every year.
J. Michael Scarborough, president and CEO of the Scarborough Group, an Annapolis, Md.-based investment advice and allocation management firm, lauds the outpouring of attention, claiming that "the best resolution is access to personalized advice and management."
The Portman-Cardin legislation is one of at least 12 proposals floated by Bush and various lawmakers. Several suggest limiting the amount of company stock in 401(k) plans, an idea that has come under fire by business groups.