(Dow Jones) If the U.S. Labor Department has its way, the rules governing who can give Americans investment advice about their 401(k)s and IRAs, and how that advice gets delivered and paid for, soon will change. But financial advisors and others disagree dramatically on whether the proposed rules will help or harm investors.

The Obama administration's aim is to eliminate the problem of advisors with hidden conflicts of interest giving slanted advice to unsuspecting retirement savers. But will the proposed rules achieve that goal? Like many things in life, it depends on who you ask.

Most independent, fee-only advisors who make a living giving investment advice to 401(k) plan participants and IRA owners are praising the proposed rules. Broker-dealers, meanwhile, are apoplectic. Others are somewhere in between.

According to Vice President Joe Biden, who unveiled the new rules at the White House last week, "the first of the two rules would ensure workers receive unbiased advice about how to invest in their individual retirement accounts or 401(k) plans.

"If the rule is adopted, it would put in place safeguards preventing investment advisors from slanting their advice for their own financial benefit. Investment advisors also would be required to disclose their fees, and computer models used to offer advice would have to be certified as objective and unbiased," he said.

The Labor Department estimates that 2 million workers and 13 million IRA holders would benefit from this rule-to the tune of $6 billion.

But there are plenty of opportunities for missteps with the new rules, some say.

"How this new regulation is going to be interpreted is critical-there are conditions that hang on the precipice; it's not going to take much of a misinterpretation to send the regulations over the edge," said Don Trone, chief ethos officer at Strategic Ethos.

Others point to enforcement as a potential issue.


     More, Not Less, Investment Advice Needed  

The Bush administration, in its waning days, issued new rules that made it easier for brokers to give advice to 401(k) plan participants. But the Obama administration put the kibosh on those rules and has now issued rules more to its liking.

Not to Bradford P. Campbell who served as the assistant secretary of labor heading the department's Employee Benefit Security Administration from 2006 to 2009, where he promulgated the prior rule that was then withdrawn by the current administration and replaced by this proposal.

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