The Financial Services Institute’s annual OneVoice conference for broker-dealer home office personnel is part family gathering and part sizing up the competition, but always a celebration of the independent broker-dealer business model, particularly its advocacy successes. When it comes to FSI’s top advocacy priority of the last few years — the Department of Labor’s redefinition of fiduciary under the Employee Retirement Income Security Act — there was no celebrating at this year’s conference in Orlando. However, FSI’s advocacy leaders vowed to keep fighting, though they also counted advocacy successes in 2015.
At an early-morning meeting with the media on Tuesday, president and CEO Dale Brown said that fight was a success, citing FSI members who he said sent “thousands” of messages to regulators and legislators opposing the rule. When asked by a reporter why FSI “lost” its fight, Brown replied that President Barack Obama’s support for the rule “was a game changer,” helped by continued “gridlock” in Congress. “We’ll continue to champion a fiduciary standard” for advice givers, he continued, but reiterated that DOL’s “proposal as written is unworkable.” When asked by another reporter if FSI would consider taking legal action against the rule, Brown said “we’re not ruling out any action.”
When asked if FSI would consider using its political action committee money to support a presidential candidate, Brown said that FSI would continue its policy of not doing so, though it would also continue to donate to congressional candidates.
David Bellaire, who oversees FSI’s advocacy efforts as executive vice president and general counsel of the IBD group, said that “at the Department of Labor there’s a perspective that doesn’t jibe with reality,” while current FSI chair Amy Webber said the DOL rule would create “three potential” fiduciary standards. She said that the dispute over the DOL rule was not one of a difference of “intentions” by its promoters and detractors in terms of fiduciary, but rather the best way to apply a fiduciary standard, or “the how.”
Later in the morning at a general session focusing on regulatory and compliance issues, Bellaire vowed that FSI would continue to fight against the DOL rule, which he said had become a cornerstone of Obama’s domestic agenda in his second term despite the “irreparable harm” it will cause to investors.