Author Archives: Carolyn Sofman

Coalition Statement on SEC Chair Mary Jo White’s Testimony Before the House Financial Services Committee

The Financial Planning Coalition applauds Securities and Exchange Commission (SEC) Chair Mary Jo White’s decision to direct SEC staff to develop a rule to establish a uniform fiduciary standard of conduct for broker-dealers consistent with the current standard for registered investment advisers:

“A uniform fiduciary standard of conduct for broker-dealers is a long overdue investor protection, and will close the harmful gap between advice provided by investment advisers under a fiduciary standard and the merely ‘suitable’ advice currently required from broker-dealers. We urge the SEC to act swiftly to move forward with this well-researched proposal, which will protect Americans from potentially detrimental investment advice not delivered in their best interest.”

Congress authorized the SEC to adopt a uniform fiduciary standard under the Dodd-Frank Act nearly five years ago, and SEC staff first recommended the adoption of a fiduciary standard four years ago, allowing for ample research and careful consideration of this investor protection measure. Regarding Chair White’s request that SEC staff also prepare recommendations on third-party examinations to supplement the Commission’s existing examination program, the Coalition believes:

“New proposals regarding investment adviser oversight, specifically third-party examinations, have yet to undergo the level of thorough discussion and scrutiny that informed Chair White’s decision to move forward with fiduciary rulemaking. We encourage Chair White and the SEC to carefully consider all of the options for making necessary improvements to adviser oversight – including user fees – before proceeding. Oversight and examinations are a critical part of the SEC’s investor protection mission, and measures for improving this program merit further research.”

Financial Planning Coalition Applauds SEC Chair Mary Jo White’s Support for a Uniform Fiduciary Standard

The Financial Planning Coalition issued the following statement regarding Securities and Exchange Commission (SEC) Chair Mary Jo White’s announcement at the SIFMA Compliance and Legal Society Annual Seminar that she personally believes that the SEC should implement a uniform fiduciary duty for broker-dealers and investment advisers.

“We applaud Chair White for her view that a fiduciary rulemaking to protect investors is long overdue. American investors have suffered for too long from advice that is not necessarily in their best interest. Even as the Department of Labor (DOL) advances a separate fiduciary proposal for retirement assets, the SEC should now boldly move forward with its own rulemaking to close the harmful gap between advice provided by investment advisers under a fiduciary standard and the merely ‘suitable’ advice currently allowed by broker-dealers.

“It has been nearly five years since Congress authorized the SEC to adopt a uniform fiduciary standard under the Dodd-Frank Act, and four years since SEC staff recommended the adoption of a fiduciary standard that is ‘no less stringent than currently applied to investment advisers under the [Investment] Advisers Act [of 1940].’ We again urge the SEC to move forward thoughtfully and promptly to propose a rule that is consistent with this recommendation. American investors deserve advice that is in their best interest.”

Financial Planning Coalition research shows that American consumers want greater investor protection, including through the adoption of a fiduciary standard. In response to a 2013 survey, 93 percent of respondents said that they agree with the statement that financial advisers “should put your interests ahead of theirs and should have to tell you upfront about any conflicts of interest that potentially could influence that advice” – the very definition of the fiduciary standard.

Coalition Statement on Appropriators’ Letter to OMB Regarding DOL Fiduciary Rule

The Financial Planning Coalition issued the following statement after a letter from the Chairmen of the House and Senate Appropriations Subcommittees on Financial Services and General Government was sent to Office of Management and Budget (OMB) Director Shaun Donovan, expressing concerns over the Department of Labor’s (DOL) fiduciary rule proposal:

“We continue to urge the OMB to thoroughly and swiftly review the DOL’s proposed fiduciary rule and to resist any attempts by policymakers and industry participants to halt or delay this process based on mere presumptions about a yet-to-be-released rule. Premature attempts to keep the DOL’s proposed update of a 40 year-old rule from being subject to public review and comment should be opposed. While the Coalition cannot support the substance of a rule it has not seen any more than opponents can condemn it, we support an open and transparent process, a position anyone concerned about the security of Americans’ retirement savings should hold. We look forward to reviewing the rule when it is released for public review and comment by all stakeholders.”

Coalition Statement on Wagner Fiduciary Bill

The Financial Planning Coalition issued the following statement after Rep. Ann Wagner’s (R-MO) reintroduction of legislation that would delay, or even prevent the U.S. Securities and Exchange Commission (SEC) and the Department of Labor (DOL) from developing fiduciary rules crucial to investor protection:

“Rep. Wagner’s legislation, the Retail Investor Protection Act, is an investor protection bill in name only. The Financial Planning Coalition helped prevent this legislation from becoming law when it was first introduced and continues to oppose it now and in the future. This bill, if enacted, would leave American investors vulnerable to potential abuses and would substantially impede or even prevent the SEC from proceeding with Congressionally authorized fiduciary rulemaking. All investors deserve to receive investment advice that is based on their best interests, and this legislation would require the Commission to consider less adequate and less effective alternatives. The bill would also slow or effectively prohibit the DOL from proceeding with its proposed fiduciary rulemaking for financial professionals who provide investment advice to retirement savers. This cynical attempt to undermine these critical investor protection efforts should be opposed.”

Coalition Statement on White House announcement on DOL Fiduciary Proposal

The Financial Planning Coalition issued the following statement regarding the White House’s announcement that the Department of Labor’s (DOL) long-anticipated proposed rule to amend the definition of “fiduciary” under the Employee Retirement Income Security Act (ERISA) has been sent to the Office of Management and Budget (OMB) for review:

“Today’s White House announcement in support of the Department of Labor’s fiduciary rule proposal is a strong sign that investor protection is a priority for this Administration. Given the significant changes to retirement saving since the passage of ERISA, it is entirely appropriate for the DOL to reevaluate the 40 year-old rule defining the fiduciary standard for those financial professionals providing investment advice to retirement savers. We look forward to reviewing the department’s proposal, and urge OMB to complete its review of the rule in a timely fashion. Saving for a decent retirement is a fundamental part of life for every American. Those who work hard and save for the future deserve financial professionals whose primary concern is the best interests of their clients and not their bottom line.”

Coalition Statement on President Obama’s Proposed FY 2016 Budget

The Financial Planning Coalition issued the following statement regarding President Obama’s FY 2016 budget proposal:

“The Financial Planning Coalition is pleased that President Obama addresses the current and persistent underfunding of the SEC in his 2016 budget proposal, once again requesting $1.7 billion. While Congress modestly increased the SEC’s budget for 2015, the agency’s funding remains woefully inadequate, impeding its oversight and examination of investment advisers. We urge lawmakers to support greater investor protection by adequately funding the SEC.”