More On Legal & Compliancefrom The Advisor's Professional Library
- Do’s and Don’ts of Advisory Contracts In preparation for a compliance exam, securities regulators typically will ask to see copies of an RIAs advisory agreements. An RIA must be able to produce requested contracts and the contracts must comply with applicable SEC or state rules.
- Client Commission Practices and Soft Dollars RIAs should always evaluate whether the products and services they receive from broker-dealers are appropriate. The SEC suggested that an RIAs failure to stay within the scope of the Section 28(e) safe harbor may violate the advisors fiduciary duty to clients, so RIAs must evaluate their soft dollar relationships on a regular basis to ensure they are disclosed properly and that they do not negatively impact the best execution of clients transactions.
On day one of its national conference in San Antonio, FPA Experience 2012, the Financial Planning Association announced that Janet Stanzak was selected as 2013 FPA president-elect at the association’s board meeting in Texas on Friday.
As announced by current FPA President Paul Auslander in his introductory remarks on Saturday—“Janet’s just the best,” he said—Stanzak’s selection was a change from previous FPA practice, in which a president-elect was named early in the year prior to when she would take on the presidency; Stanzak (left) will thus succeed FPA’s 2013 President Michael Branham.
When asked in an interview Saturday about the skills she would bring to FPA leadership, Stanzak noted that she had led the association’s strategic planning committee for two years, during which time she worked “hand-in-hand” with Lauren Schadle, the incoming FPA CEO. As staff liaison, Schadle was responsible for implementing the committee’s recommendations.
Stanzak said she had also particularly engaged with FPA’s chapters and chapter leaders. “They know me as a resource and a collaborative leader,” she said. The chapter connection is important, she said, since new FPA members tend to come through the chapters, along with growth from those new to the profession. On the issue of retaining members, she noted that at the FPA, members who are CFPs have a higher rate of retention, suggesting that CFPs were more likely to see the benefit of membership.
Declining membership has been an issue for the FPA for some time now, though Stanzak said that “most associations have lost membership.” However, she said that while FPA’s membership numbers had fallen up to June, they have been increasing since then. The FPA’s Board has had discussions on the relative importance of quantity of members to quality, Stanzak said, since “part of our primary aim is to advance the profession; that’s where numbers matter.”
Numbers matter as well, she said, when it comes to FPA’s advocacy efforts in Washington. When asked if the FPA leadership was pleased with its level of access to policymakers, Stanzak said that “we continually strive to get better access,” but that the striving was limited somewhat by FPA’s relative lack of funds.
Stanzak, a CFP since 1986, is the owner and principal of Financial Empowerment, a fee-only financial planning firm in Bloomington, Minn. In the interview she pointed out that she had started as a commission-based planner and had worked for, launched or run a total of four different firms that were affiliated with independent BDs or RIAs, and was a member of NAPFA, so she had “walked in the shoes of a majority of our members." She had also launched an RIA as part of an ensemble firm within a midsize CPA firm, so she had experiences of having “allied professionals as my business partners.”
As for the departure of longtime FPA CEO Marv Tuttle, who hands over the reins to Schadle this week, Stanzak said that “Marv was the right person” through the early history of the FPA from the merger of the ICFP and IAFP, through forming relationships with other groups—such as NAPFA, the CFP Board and the IAA—and that he was also a collaborative leader who will always rate a high place in the history of financial planning. By the same token, she said that Schadle will be the “right person at the right time” for the FPA, with a greater forucs on strategic planning and business management, and that “change is healthy for an organization.”