LPL Financial (LPLA) said this week that it is opening an office near Capitol Hill in Washington, D.C., several months after ending its membership in the industry lobby group for independent broker-dealers, the Financial Services Institute.
“In the past, LPL has relied more significantly on FSI because we did not have a Washington, D.C. office or a state government relations program. This is no longer the case. LPL has now invested significant resources to build our own government relations function and to establish our own voice on positions and issues that matter to us,” explained LPL spokeswoman Lauren Hoyt-Williams in a statement.
(The news of the break with FSI was first reported Wednesday by RIABiz.)
LPL’s move in the nation’s capital comes two years after it hired Nicole Petrosino to join its government relations team as a VP and head of its federal lobbying efforts. The IBD insists that opening an office near Capitol Hill and representing itself in Washington, D.C., is a logical extension of its overall lobbying efforts as a major player in the broker-dealer space.
“With the Great Recession and Dodd-Frank [legislation], we knew we were at a point where as a firm and as an industry leader … we felt we should be speaking out and having a seat at the table from a leadership perspective,” said Peggy Ho, head of government relations for LPL, in an interview. “We started investing in our government-relations efforts in 2009-2010 and working more with industry groups.”
The IBD set up a political action committee in 2010, Ho says, and then organized a government-relations team within its legal department, hiring a staff member in the Washington, D.C. area, to complement the work of another LPL employee there.
As for FSI’s reaction, the head of membership and marketing, Chris Paulitz, explained, “We very much value LPL’s involvement at FSI for over a decade and for their leadership in helping us grow to nearly 40,000 financial advisor members. And we’re grateful to have thousands of LPL advisors as members – including on our board of directors.”
Today, the employees at LPL Financial’s D.C. office include Sarah Gill, senior VP of government relations, who focuses on regulatory policy; Emily Gordy, executive VP and deputy general counsel of regulatory affairs; Petrosino; and executive administrative assistant Denena Washington.
“The work of our Government Relations team is one important way LPL demonstrates its commitment to ensuring all Americans have access to independent financial advice,” said David Bergers, the firm’s Boston-based general counsel and managing director of Legal and Government Relations, in a statement.
DOL and Legal Issues
In April, LPL issued a conciliatory response to the Department of Labor’s new fiduciary rule, saying it “is pleased by what appears to be positive changes implemented in the rule and appreciates the Department of Labor’s willingness to listen to concerns about protecting choice for investors.”