March 30 (Reuters) – The U.S. Department of Labor on Monday issued long-awaited proposed new rules intended to clarify how trustees can add alternative assets ranging from private equity to cryptocurrencies to 401(k) retirement plans.
The measure, which is intended to ease long-standing barriers to incorporating these less liquid and less transparent assets in American retirement nest eggs, follows an executive order by President Donald Trump last summer and could clear the way for alternative asset management firms to tap a large and potentially lucrative new source of capital.
The guidance lays out how trustees, who have a fiduciary duty to act in the best interest of retirement plan members, as spelled out in the Employee Retirement Income Security Act (ERISA), can incorporate these assets.
Under the proposed rule, fiduciaries when selecting alternatives need to make determinations on factors such as performance, fees, liquidity and valuation.
(Reporting by Utkarsh Shetti and Arasu Kannagi Basil in Bengaluru; Editing by Shinjini Ganguli)
