Warren, Sanders, Colleagues Sound Alarm on Trump Executive Order Exposing Americans' Retirement Plans to Risky Private Markets and Crypto

Warren, Sanders, Colleagues Sound Alarm on Trump Executive Order Exposing Americans' Retirement Plans to Risky Private Markets and Crypto

"This is dangerous and could lead to financial harm for millions of Americans as the cost of groceries, health care, and housing continues to skyrocket."

"How can the American people trust the advice they get from an Administration that stands to potentially further profit by this move?"

Text of Letter (PDF)

Washington, D.C. - U.S. Senators Elizabeth Warren (D-Mass.), Ranking Member of the Senate Banking, Housing, and Urban Affairs Committee, and Bernie Sanders (I-VT), Ranking Member of the Senate Committee on Health, Education, Labor and Pensions, led five of their colleagues in sending a letter to Labor Secretary Lori Chavez-DeRemer and Securities and Exchange Commission (SEC) Chairman Paul Atkins raising concerns about President Donald Trump's executive order that pushes risky private market funds and cryptocurrencies into Americans' retirements plans.

Along with Warren and Sanders, Senators Dick Durbin (D-IL), Jeff Merkley (D-OR), Chris Murphy (D-CT), Tina Smith (D-Minn.), and Ron Wyden (D-OR) signed the letter.

"The Executive Order exposes these hard-earned savings to volatile financial instruments, while attempting to rebrand them as 'alternative assets,' although they lack transparency and have exaggerated claims of high returns," the Senators wrote.

The Senators expressed concerns about exposing Americans' retirement plans to private markets that lack the same investor protections of public markets: "In recent years, the SEC has issued risk alerts identifying significant compliance failures among private funds, primarily regarding conflicts of interest, fees and expenses, and policies and procedures relating to material non-public information."

"Private investments, including private equity, rely on long-term capital, and as a result, usually stipulate lengthy lock-up periods for investors," the Senators continued. "This of course makes these investments illiquid, meaning they are not easily sold to other investors or convertible into cash. This raises serious concerns during economic downturns when retirement savers are seeking to access their investments."

The Senators sounded the alarm over the potential effects of exposing Americans' retirement savings to crypto: "The DOL recognized this in its 2022 guidance, stating plan fiduciaries should exercise 'extreme care before they consider adding a cryptocurrency option to a 401(k) plan's investment menu for plan participants.' Now, the DOL has pulled that safety net out from under workers, reversing course on crypto protections abruptly and without clear reasoning."

The Senators also raised concerns about how Trump's executive order could financially benefit the Trump family: "According to the Wall Street Journal, in the last few months alone 'the Trump family notched as much as $5 billion in paper wealth…after its flagship crypto venture opened trading of a new digital currency.'" … " How can the American people trust the advice they get from an Administration that stands to potentially further profit by this move?"

The Senators concluded by calling for answers to their questions on the potential effects of exposing millions of Americans' retirement savings to private market and cryptocurrency products by November 17, 2025.

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