FOR IMMEDIATE RELEASE: Aug. 7, 2025
CONTACT:
Jarice Thompson, AFR, jarice@ourfinancialsecurity.org
Nicole Gaudiano, AFT, 703-967-6816, ngaudiano@aft.org
Trump Executive Order Would Let Wall Street Line Its Pockets with Retirement Savings
Washington—The Trump administration released an executive order that opens the door to private equity firms accessing the retirement savings of millions of families. This is a dangerous scheme that will rip off small investors, and it’s a major step in the private equity industry achieving its long-standing goal of peddling risky, high-fee offerings to small retail investors.
Long-standing rules protected retail investors and retirement savers from these high-risk, expensive and illiquid investments because they lack the standard disclosures—like those of public stock and bond markets—necessary for investors to assess the risks and costs. The push to let private equity into retirement savings accounts comes as private equity funds are facing a persistent decline in performance and difficulty selling assets. The executive order is a timely windfall to help rescue Wall Street private equity firms by giving them access to the retirement savings of millions of small investors.
“In 2008, Wall Street got a no-strings-attached taxpayer bailout for gambling with our economy by peddling toxic mortgages—but millions of hardworking families lost everything. Now Wall Street has set its sights on gambling with working families’ 401(k)s,” said AFL-CIO President Liz Shuler. “President Trump’s executive order offers the same private equity billionaires, who have spent years killing off regulations on their investments, our hard-earned retirement savings on a silver platter. The working people of this country deserve the right to retire with dignity, not to lose all they’ve worked for just so the rich can get richer.”
“With more institutional investors headed for the exit, private equity is looking for new sources of fee income and easier places to unload opaque high-fee, high-risk investments with less scrutiny. Exposure to these risky investments with little transparency and manipulated values will put trillions of dollars of retirement earnings at risk,” said Lisa Donner, co-executive director of Americans for Financial Reform. “Workers who spent their lives building a nest egg deserve a regulatory regime that will help them retire with dignity, not make Wall Street richer.”
“Let’s be clear. This is the Trump administration bailing out private equity funds and the billionaires who run them at the expense of working Americans, who will be asked to bear all the risk of loss if private equity investments in their 401(k) plans tank,” said AFT President Randi Weingarten, whose members participate in public pensions as well as defined contribution plans that may be affected by the order. “When plan sponsors choose to allow these unregulated, pricey investments into 401(k) offerings, they too are taking big risks. They should know we will be watching, and we will continue to defend our members’ retirement security by any means necessary.”
A recent joint report by Americans for Financial Reform Education Fund and the AFT exposed how private equity returns fail to live up to its own high-performance hype. The report, “From Public Pension to Private Fortunes: How Working People’s Retirements Line Billionaire Pockets,” highlights the heavily manipulated reporting of returns, lack of transparency, and high fees that characterize the industry. When even savvy institutional investors are suffering from these problems, individual investors won’t stand a chance.
Private equity has been pushing for access to the trillions of dollars in retail investors’ retirement accounts like 401(k)s to rescue the industry. Private equity funds are currently struggling to raise additional dollars, decreasing distributions to investors and having a hard time selling assets.
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