It’s a complaint that Skip Schweiss has heard more than once from lawmakers on Capitol Hill when lobbying on behalf of advisors: “‘We hear from the insurance companies and broker-dealers all the time, but we don’t hear from the investment advisors. Where are they? We need to hear from them.’”
That’s what Schweiss, TD Ameritrade Institutional’s managing director of advisor advocacy and industry affairs, relayed to me in an interview after TDAI held its Advocacy Leadership Summit in Washington in early October.
TD unveiled at the event its new advocacy tool for advisors, TDAInstitutional.com/TakeAction, which allows advisors to access summaries on pressing issues impacting the industry, and to submit comments to regulators as well as lawmakers.
TD will “periodically highlight issues as they come up,” Schweiss said, particularly those being considered by Congress, as well as post position papers and sample letters that advisors can use to send to lawmakers.
Quite a few advisors attending the Summit signed up for the tool on site, Schweiss reported. “One told us it took him 60 seconds to sign in, send the letter [to his congressperson] and be done,” Schweiss said. “We know advisors want to be able to weigh in, but they don’t have a lot of time to do so. So [any advocacy tool] needs to be efficient.”
Top lobbyists for the Investment Adviser Association and the CFP Board agree that the advisory industry is in a David and Goliath advocacy fight. “There’s no doubt that we remain outgunned by the brokerage and insurance industries,” said Neil Simon, vice president for government relations at IAA.
Marilyn Morhman-Gillis, managing director of public policy and communications for the CFP Board, added that members of the Financial Planning Coalition — which includes the CFP Board, the FPA and NAPFA — are engaged through separate lobbying efforts as well as combined efforts through the Coalition, but unlike the deep-pocketed BD and insurance industries, “we can’t spend millions of dollars” on lobbying.
Playing Catch Up
The insurance and brokerage industries, Simon added, “have had very well-funded advocacy programs, both direct funding and grassroots, for decades. We are still playing catch up, and it is still a David and Goliath battle. But David ultimately didn’t do too badly.”
Indeed, Simon said that IAA is focused on increasing advisors’ grass roots capability, and “frankly, we’re quite gratified with the growth of political involvement and engagement with advisors,” noting IAA’s lobbying day on Capitol Hill is growing and effective.
When advisors return to Capitol Hill for their annual pilgrimage, lawmakers as well as their staffs know who they are and know the issues, Simon added. “We are seeing progress. Is it enough? No.”
The biggest fight the advisory industry has faced has been in lobbying related to the Department of Labor’s rule to amend the definition of fiduciary under ERISA. While the insurance and brokerage industries have engaged in an “expensive” lobbying campaign to thwart the rulemaking, said Mohrman-Gillis, “the common sense and rational arguments in support of the DOL rule are starting to break through the clutter of misinformation that has been communicated to policymakers” from the BD and insurance groups.
Case in point: The number of Democrats supporting Rep. Ann Wagner’s bill that would make the DOL wait to issue its rule until the SEC moves on its own rule garnered support from only one Democrat at its recent House Financial Services Committee markup.
More ‘Factual Advocacy’ Has an Effect
Despite the lack of Democratic support, Wagner’s bill, the Retail Investor Protection Act, passed out of the House Financial Services Committee and was referred to the full House. When it was initially floated in 2013, Wagner’s bill had the support of 13 committee Democrats.
Mohrman-Gillis attributes the dwindling support for Wagner’s bill to “more factual advocacy” from the advisory industry regarding DOL’s rulemaking, which she said has caused members of Congress to shift from their initial positions on Wagner’s bill.