Investment guru John Bogle warned that demolishing the Department of Labor's fiduciary rule “would clearly be a setback for investors trying to prepare for retirement.”

“The demise of the fiduciary rule would be a step backward for our nation, allowing Wall Street to continue to profit by providing conflicted advice at the expense of working Americans saving for retirement,” Bogle recently wrote for the New York Times.

Nor is it “a good business practice for Wall Street to tell its client-investors, ‘We put your interests second, after our firm’s, but it’s close,’” the  Vanguard founder wrote.

Bogle said the existing proposal doesn't go far enough because it is limited to retirement plan accounts and “ignores the other three-quarters of the assets owned by individual investors.” Any effective rule, he said, must cover all investors. 

When a consulting firm projected that the DOL rule would cost the industry $20 billion in lost revenue by 2020, “it meant that net investment returns for investors would increase by $20 billion,” he writes. “By any definition, that’s a social good.”

Bogle adds that the fiduciary principle will live on even if the DOL rule is rolled back. 

“With or without regulation by the federal government, the principle of ‘clients first’ is here to stay.”

To be sure, the rule itself is controversial.

Gary Cohn, director of the White House National Economic Council and former president of Goldman Sachs, recently told the Wall Street Journal that the fiduciary rule is bad for consumers -- a common scare tactic from critics of the rule, Bloomberg reported.

"Their translation: Ordinary investors will have fewer and more expensive investment options if the rule takes effect," Bloomberg Gadfly Nir Kaissar wrote.

"But the opposite is true. Investors are demonstrably better off today than they were before the rule was issued last April. Morgan Stanley, for example, is lowering commissions, reducing conflicts of interest and improving disclosures," he wrote.

"Merrill Lynch is breaking out investment fees that were previously buried in client statements, which will better allow investors to dodge exorbitantly priced investment products."

(Newsmax wire services contributed to this report).

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