“Labor Department Deputy Secretary Keith Sonderling pledged to deliver a new rule on the inclusion of investments like private-equity and private-credit in pension plans. The rule will prioritize transparent standards that will give plan sponsors cover against potential litigation that has kept many retirement plans from adopting such ‘alternative assets,’ he said at an industry event hosted Wednesday by the Securities Industry and Financial Markets Association.
“We have an industry living in fear … that a judge or a lawyer is going to second guess their decisions,” Sonderling said. “We have to eliminate that.”
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Labor Department Promises Rule on 401(k) Private Investments
By Max Wirz
The Wall Street journal
January 7, 2026
Labor Department Deputy Secretary Keith Sonderling pledged to deliver a new rule on the inclusion of investments like private-equity and private-credit in pension plans. The rule will prioritize transparent standards that will give plan sponsors cover against potential litigation that has kept many retirement plans from adopting such “alternative assets,” he said at an industry event hosted Wednesday by the Securities Industry and Financial Markets Association.
The proclamation follows an executive order President Trump signed last summer instructing the Labor Department to consult with other federal agencies to determine what regulatory changes to make.
Alternative investment fund managers including Apollo Global Management have long sought protections, or “safe harbor,” for pension plans against class-action lawsuits alleging that products like private equity burden retirees with excessive fees and subpar performance. It’s not clear whether the new rule will include safe-harbor provisions, but Sonderling highlighted litigation risk in his comments.
“We have an industry living in fear … that a judge or a lawyer is going to second guess their decisions,” Sonderling said. “We have to eliminate that.”
Only 10% of investors say they are dissatisfied with their current 401(k) investment offerings and want more nontraditional options, according to a survey of U.S. adults conducted last year by Harris Poll on behalf of The Wall Street Journal.
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