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April 14, 2011 at 08:00 PM
WASHINGTON BUREAU – The American Society of Pension Professionals and Actuaries (ASPPA) and the National Tax Sheltered Accounts Association (NTSAA) say a U.S. Securities and Exchange Commission (SEC) municipal advisor regulation proposal exceeds the intent of the Dodd-Frank Wall Street Reform and Consumer Protection Act.
Officials at ASPPA, Falls Church, Va., and the NTSAA, an ASPPA affiliate, make that argument in a comment submitted to the SEC in connection with proposed rules 15Ba1-1 through 15Bal-7.
The proposed municipal advisor registration rules could push away some of the retirement plan professionals who work with governmental sponsored retirement plans, ASPPA and NTSAA officials say in the comment letter.
The groups believe that the Dodd-Frank Act was not intended to extend the municipal advisor registration requirements to those who work with governmental retirement and savings plans, the group officials say.
“If the act’s registration requirements were to be applied in this context, it would have a severe chilling effect on the availability of this much needed service, and may cause a market disruption in favor of larger, SEC-registered investment advisors by subjecting only smaller, local investment advisors to the municipal advisor registration requirements and associated [Municipal Securities Rulemaking Board] rules,” the officials say.
“Clearly, a law aimed at regulating the practices associated with municipal bonds should not be applied inappropriately and inconsistently to those advising participants in governmental retirement and savings arrangements,” the officials say.
The officials say this is particularly true for governmental retirement savings plans funded exclusively with employee contributions.
“Similarly, providers of advice and information to the participants in governmental retirement and savings plans should not be subject to registration as municipal advisors,” the officials say.
