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Regulation and Compliance > State Regulation

FSI Is Optimistic It Can Work With New Congress

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Financial Services Institute President & CEO Dale Brown says the group “sees lots of common ground” with Democrats in Congress, including House Financial Services Committee Chair Maxine Waters.

“In all our 15 years, we’ve made it a priority to work with everyone elected by the American public to represent them,” Brown said during the FSI OneVoice 2019 conference on Tuesday in New Orleans.

“Access to advice and investor protection are not partisan issues,” he added, though there are differences of opinion on how to best accomplish these goals.

Waters has “always had an open door to us over years and listened to our input,” Brown said, “and I have confidence that will continue.”

FSI will be busy meeting with the nearly 100 new members of Congress over the next few months and sharing its views. “We have been reading Waters’ speeches and getting up to speed on issues she has prioritized,” said David Bellaire, FSI’s general counsel.

Waters, for instance, has helped form a Diversity and Inclusion Subcommittee. It is examining low numbers of women and minorities in the ranks of senior management and overall in the financial services industry, numbers that she has said must improve.

Asked about the lack of women on FSI’s executive committee, Brown pointed out that two of six new members of its board of directors are women: advisor Denise Barrows of Barrows Trostle Advisors (which trades through 1st Global Capital), who has been in the industry for 24 years; and Carolyn Clancy, head of the broker-dealer segment of Fidelity Clearing and Custody Solutions, who has been with the firm for about 20 years.

The group “can do more in areas like financial literacy,” according to FSI Board Chair David Knoch, the president of 1st Global, “and by getting more students to go into financial planning and financial advisory work.”

Knoch said diversity and inclusion efforts are “tremendously important to members of FSI,” as shown with the 180 attendees at Monday’s pre-conference session on advancing women in leadership. “I suspect and hope that will align” with the new subcommittee.

FSI and other industry players can push to change the situation for those taking time off after the birth of a child, for instance, who have their professional licenses lapse after two years, says FSI Vice Chair John Rooney, a managing principal of Commonwealth Financial. “This is a big barrier, so doing something along those lines could be good.”

The advocacy group, Brown says, works for its board to reflect the diversity of membership. “Gender is one aspect,” he explained, with FSI also seeking to include individuals from broker-dealers of different sizes and from firms with different ownership structures.

State Fiduciary Rules, Health Care

Turning to fiduciary rules being pursued by Nevada and several other states, Brown said the group helped push back against a proposal in Maryland. “There’s still more to do there, as well as in New Jersey and other states,” he explained.

Though possible legislation is on the table in some states, “We do not see this as [reflecting] a loss” on the part of FSI, Brown said.

“Our priority is to engage at the state level. That states have a patchwork of regulation adds to confusion and costs and thus undermines investor protection,” he explained.

Turning to the issue of health care plans for independent advisors, FSI leaders said this is an important priority for the group, which gets daily requests for such services.

The group is working to move forward on such plans in April, depending on what happens to the Affordable Care Act in the courts.

“It’s been 31 years for me working with independent advisors, and I have heard from day one that business owners need a solution for access to affordable health care insurance,” Brown said. “We are well positioned to move forward with a solution [for members], as soon as we have clarity from the courts or otherwise.”

About 160,000 advisors work with FSI member firms, the group says, and about 15% of advisors are enrolled in its long-term disability and insurance program.


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