We caught up with Mari Buechner, CCO and CEO of Coordinated Capital Securities, Inc., of Madison, Wisconsin, after her election as the new chair of the Financial Services Institute. She's a familiar face at FSI, having served on the board since 2007 and as its compliance chair from 2005 to 2007. She does, however, break new ground as chair, coming as she does from a small firm. Her considerable expertise in independent contractor and small-firm business models will undoubtedly stand her in good stead.
What is your agenda for FSI? How does that dovetail with the existing FSI plans for 2010 and beyond?
The primary, overarching agenda for FSI is what it's always been: to help the independent model thrive...In 2009, the board of directors unanimously reaffirmed FSI's vision: that all individuals have access to competent and affordable financial advice, products, and services delivered by a growing network of independent financial advisors affiliated with independent financial services firms...[We're] very focused on working to ensure a healthy future for the independent channel...We've seen movement of financial advisors to the independent channel in numbers we've never seen before. And given the legislative events of 2009--with regulatory reform such a dominant issue, and still pending--we're also focused on our mission to create a healthier regulatory environment for the independent channel through targeted advocacy, education, and public awareness.
What are the top priorities for FSI in the coming year?
First, we will continue to be engaged in influencing a final regulatory reform bill so that the interests of clients, advisors, and broker/dealers are represented.
Our next two priorities could have a significant impact. The first is the independent contractor issue. Legislation was introduced...that would remove the tax code's "safe harbor" provision and potentially give the IRS reason to unnecessarily question the independent contractor status of financial advisors affiliated with independent broker/dealers. We're actively working to ensure that this legislation is not passed in its current form.
Second, there is a real possibility of a repeal or reform of 12(b)-1 fees...It's very important to our members that the SEC and members of Congress fully understand these fees and the important role they play in independent advisors serving middle-class clients. We do not believe that these fees result in investors "overpaying" for services...Without these fees as payment for ongoing monitoring and guidance, many smaller investors may be shut out from the services of an independent advisor.
Finally, a priority for 2010 is attracting new financial advisor members and providing them a valuable way to engage in advocacy on their own behalf, through the collective power of a group. We have great, effective, and simple advocacy tools on the FSI website for advisors to use; we keep members well informed through monthly advocacy briefs; and this year we've added podcasts and quarterly conference calls for financial advisors.
What do you see as the most important issues FSI must deal with going forward?
There's no question that the huge regulatory reform effort--the draft Senate bill alone is incredibly broad in its proposed reach--has dominated the agenda for almost all financial services firms and set a new tone for regulatory activism in Washington. Any restructuring of the regulation of the financial services industry must focus on improving regulation for the specific benefit of middle-class investors.
We will also continue to improve FSI's grassroots advocacy efforts. Educating legislators and regulators on our model is the most important way we can advocate on behalf of our members and an issue on which we're always focused.
What differences in point of view or approach might you bring to the chairmanship, coming from a small independent broker/dealer rather than a large one?
Small firms represent more than 95% of FINRA's membership and have been, in many ways, hit the hardest with the events of the last two years. For some small firms it's a real struggle to survive. Small firm interests are strongly represented by [FINRA's small firm advisory board], who volunteer their time to address small firm issues. Small firms also represent about 25% of our FSI broker/dealer members. I think my experience leading a small broker/dealer will be well balanced by the experience of 2010 vice chair Bill Dwyer of LPL, the largest independent broker/dealer, as well as other board members who represent mid-sized broker/dealers. I'm confident we'll be a strong and effective team on behalf of FSI members.
Marlene Y. Satter, a freelance business writer who can be reached at firstname.lastname@example.org.