The Financial Services Institute is imposing a stiff dues increase on its broker-dealer members to help boost its lobbying efforts in Washington.
In an Oct. 12 letter to all of its members, FSI said that its board of directors voted unanimously to expand its reach on Capitol Hill and in the states and that a boost in its BD members’ dues will help the lobbying group “fulfill our mission and do more for our members in an ever-changing regulatory environment.”
FSI said that its new dues structure “will fuel FSI’s fight on your behalf.” For instance, annual dues for BDs with between $25 million and $50 million in assets will jump from $6,000 to $12,900.
Said FSI’s board to its members: “Unfortunately, Washington has become an unavoidable influence on your business, and now is the time to defend our industry and then go on the offense. There is no question that this is the most critical time in our industry’s history and your need for a powerful advocate with regulators and legislations cannot be overstated. We are ready to step up–but we need greater resources to be as effective as possible. That cannot be done without a commitment from our members.”
While there have been reports that some members are balking at the increase, other members are showing their support.
“The fees for FSI pale in comparison to any other fees we’re paying for other services,” said Tim Murphy, CEO of Investors Capital Corp. “In my opinion, it’s an insignificant number because this is the time when we need to be moving forward. FSI has had many victories, and relatively speaking, has always been a bargain. Management and the board are sensitive to the current economic conditions, but most of the fee increase will be borne by the larger firms.”
FSI also reminded its members of the “recent wins” the trade group had secured for the industry: withdrawal of the Department of Labor’s fiduciary rule; indefinite delay of change in 12b-1 fees; 260 meetings on Capitol Hill during the 2011 Advocacy Summit; repeal of the expanded 1099 reporting requirements; carve out in the California independent contractor bill; delayed implementation of new FINRA suitability rule; defeated federal independent contractor legislation.
FSI said that its membership has grown from 11,000 to more 30,000 financial advisor members in 2011 alone.