Earlier this week, I made a call out to our readers to sound off on who should make our Rogue’s Gallery list for 2012. The industry rogues are those people or forces who really have done a good job at derailing the industry from carrying out its appointed tasks. So far, the response has been fantastic. Here’s our current short list of candidates, in no particular order of importance. What do you think? Do you agree with our prospective Rogue’s Gallery? Or is there somebody who really needs to be on the list that isn’t? Be sure to write your comments below, or e-mail them to me at [email protected], or follow our conversation on this on Facebook, LinkedIn and on Twitter under the #rogue hashtag.
Versus Financial, LLC
Verus Financial, LLC for the mercenary way in which it went about selling its services to cash-strapped states, turning a legitimate regulatory issue into a cynical treasure hunt at the industry’s expense. Dishonorable mentions go to the attorney generals and controllers in the various states that went along with it, but especially those in California, Florida, New York and Delaware.
Therese Vaughn and the NAIC
Therese Vaughn and the NAIC for putting its own interests before the public, for obstructing a more efficient approach to regulation (FIO, Solvency II), and for a gut-busting budget that makes us all wonder: what does it really need with all that money?
Kathleen Sebelius, Secretary of the Department of Health and Human Services as the avatar for everything that’s troubling the industry over PPACA implementation. (Dis)Honorable mentions also go to her colleagues in PPACA implementation: Steven Larsen, head of the Center for Consumer Information and Insurance Oversight, and Phyllis Borzi, secretary of the Department of Labor.
Sen. Jay Rockefeller (D-WV)
Sen. Jay Rockefeller (D-WV) for his role in championing the Medical Loss Ratio provision of PPACA, perhaps the single most contentious portion of the legislation so far for the industry (even more so than the ideologically challenging individual mandate).
Gov. Andrew Cuomo (D-NY)
Gov. Andrew Cuomo (D-NY) for spearheading the downsizing of the insurance office and financial services office into a single regulatory body, all while seeking to turn up the heat on insurers through issues such as unclaimed assets. You cannot do more with less on the regulatory front and expect the best results for both the industry and the public. But then again, should we expect anything less from somebody who used his position as AG to bash insurers and earn himself a ticket to the governor’s mansion?
Securities and Exchange Commission Chairman Mary Schapiro
Securities and Exchange Commission Chairman Mary Schapiro for her role in pushing forward with an uneven fiduciary standard for brokers that even Barney Frank has problems with. This is from the same SEC that brought us the abortive Rule 151A in an ongoing effort to expand its regulatory footprint into an insurance industry that does not really need it. And even if it did, having yet another regulatory force overseeing insurers is only making all regulation that much more fractured and inefficient.
Barney Frank (D-MA)
Barney Frank (D-MA) for his role in Dodd-Frank, SIFI, and everything else he’s done to make the life and health industry such an interesting business lately. It seems unlikely that the industry will shed many tears when Frank retires.
The Belpointe Three
The Belpointe Three for giving financial advisors everywhere a bad name. Really, what do a bunch of wealthy financial advisors from Greenwich, Ct., need to play the lottery for? While the responsible manner in which they’ve handled their winnings is to be commended, it is more than offset by the messages they have sent to a public that is increasingly skeptical of all financial services professionals, especially those whose job is to show folks how to plan for the future, but whose own plans seem to include Hail Mary passes at instant fortune. That’s no way to lead by example.
Occupy Wall Street
Occupy Wall Street for fueling misperceptions about the financial services sector. The anger and angst of the protesters can be understood easily enough; with high unemployment and a global economy still trying to shake off damage done by the excesses of Wall Street subprime trading, there seems much to protest. But drum circles formed by college grads who seem to feel they were obligated to take on student loans does not elevate a much-needed conversation on how financial services need to be regulated. Instead, it only is adding an amorphous grassroots anger bound to be seized upon by presidential candidates in 2012, distracting us from getting any real work done.
Standard & Poor’s
Standard & Poor’s for its wrong-minded downgrading of the United States’ sovereign credit rating. With the financial chaos enveloping the Eurozone these days, suddenly the dollar is looking better and better. Plus, the downgrade seemed to be spurred at least in part by the threatened credit default over the credit limit debate earlier this year, when Washington’s smartest insiders could tell that despite all the intransigent talk, Congress wasn’t really about to let the world’s single largest economy go into default over a procedure that has been approved dozens of times in recent decades.
The euro for its wobbly status and fears of contagion, which have made the world financial markets about as calm and steady as a swimming pool-sized bowl of Jell-O.
The Tohoku earthquake and tsunami
The Tohoku earthquake and tsunami for the nation-wracking damage it caused, in which the resulting $2.5 billion in life claims is just the smallest part. Our hearts continue to go out to the people of Japan.
Rep. John Boehner (R-OH)
Rep. John Boehner (R-OH) for leading a futile effort to overturn PPACA, an obstructionist charge that nearly pushed the country into default over a routine credit ceiling limit raise, and an overall level of gridlock involving situations many in the GOP might have supported under the Bush administration. The backside to standing against anything Obama and the Democrats want to do means that ultimately, you’re not really standing for anything, either. Seeing the difficulties GOP primary candidates have is proof of that.
Jon Corzine for driving MF Global into bankruptcy and further weakening confidence in the investor system. Really, you should never double down like that with other people’s money. You’d think a guy like Corzine would have known, especially given the things he was investing in. We figure he’s a shoo-in for voting the Euro in as a Rogue.
Federal Reserve Chairman Ben Bernanke
Federal Reserve Chairman Ben Bernanke for his work to keep interests artificially low. While he’s doing it to try to help the larger economy, it’s starving anybody who has written large books of annuity, long-term disability and long-term care insurance. As such, the industry is trying to push for riskier financial strategies to make up the difference…which could have catastrophic consequences.
The silver tsunami
The silver tsunami for pushing the entire industry into a higher age bracket. Older clients, older producers, older workforces…they are all combining to put incredible strains on an industry that does not evolve quickly.
Buddy Velastro, the “Cake Boss”
Buddy Velastro, the “Cake Boss,” for running the most successful bakery in the Northeast, having the most successful reality show on TLC, and for entrancing an increasingly obese country that believes cake is its own food group. Meanwhile, obesity-related disease is costing the healthcare system an avoidable $40 billion in additional medical costs each year. That’s the GDP of Sweden.
High unemployment for the pressures it is putting on employee benefits providers, sales of individual life insurance and financial planners. An amorphous rogue, to be sure, but its shadow extends over everything.
Mark Zuckerberg for that damned Facebook of his. The L/H industry still does not really understand social media, which could be the greatest sales and networking tool ever devised if the industry just made a concerted effort to engage it. But for the moment, it remains largely a channel for industry detractors to spread their message.