Exclusive: Elizabeth Warren sounds alarm on private equity in 401(k) plans

• For supporters, including the Trump administration, it's about democratizing an asset class that can generate high returns.
• For critics, like Warren, it's about putting retirement savings at risk, for the sake of bolstering private equity firm ledgers.

Zoom in: Warren, who's now ranking member of the Senate Banking Committee, uses the letter to rehash many of her past complaints about private equity, including its high fees, lack of transparency, and disputed performance history.

• She also raises uncertainties about the burgeoning private credit market.
• Warren goes on to ask Empower a series of questions, including how it determined private equity is in the best interest of its clients, details of its allocation plans, and any legal guidance it received.

Look ahead: Empower doesn't appear to have yet implemented its new program, which it says would include liquidity protections for investors and reduced fee exposure.

• A source says that it's received significant inbound interest, but that many clients are waiting for clearer legal guidance from federal regulators, who have signaled that such rules changes are coming.
• Some Empower clients already have exposure to private equity, primarily through defined benefit plans.

Read the letter: