The Financial Services Institute’s (FSI) mission is to ensure that all individuals have access to competent and affordable financial advice, products and services delivered by a growing network of independent financial advisors and independent financial services firms.
Issues Impacting Main Street Americans
Standard of Care
We support a standard of care that acknowledges and takes into account the unique characteristics of the independent financial services model and its ability to provide access to advice for Main Street investors. Independent financial services firms and advisors work within an extensive regulatory regime, and a standard of care should account for existing requirements.
The standard of care should provide financial services firms and financial advisors clarity and consistency on regulatory requirements and build upon the existing extensive regulatory regime within which firms and advisors operate. It should also ensure investors are protected and have access to affordable, objective financial advice, products and services. The SEC’s Regulation Best Interest (Reg BI) meets these goals.
Finally, we oppose any regulatory proposals that do not align with Reg BI and would create a patchwork of varying and potentially conflicting standards.
Investor Education and Protection
To help Main Street Americans realize their financial goals, including financial security in retirement, financial education must be made available to Americans of all ages. We must also protect our seniors and other vulnerable adults from financial exploitation. We will continue to advocate for states to adopt the NASAA model rule protecting seniors from financial exploitation and bring our members and policymakers together for roundtables and events on financial literacy.
Tax Treatment of Investments
It is important that new tax policies enhance Americans’ ability to save and invest for their future. We support legislation that creates incentives to encourage hard-working Americans to obtain financial advice, invest and save for a financially secure retirement.
Issues Impacting Independent Financial Services Firms & Advisors
Independent Contractor Classification
The independent contractor classification of independent financial advisors is a critical aspect of the independent business model. Advisors choose the independent advisor model – many voluntarily switching from an employee advisor model – so that they can better serve their clients. Independent financial advisors are small business owners who, inspired by the entrepreneurial spirit, build their businesses within their communities. Therefore, we oppose any legislation or regulation that would reclassify independent financial advisors as employees.
Reducing Burdens on Financial Advisors & Firms
FSI’s mission includes creating a healthier, more business-friendly regulatory environment for the independent financial services industry. To that end, we aim to reduce the burdens hampering operations and growth of our members’ businesses and align regulatory requirements with the new reality of virtual work and an evolving technology landscape. We will work with FINRA on common-sense criteria for firms conducting virtual examinations. In addition, we continue to push for no-action relief from the SEC to allow payments of securities commissions to business entities owned and operated by financial advisors. In the states, we will work to eliminate or fight back proposed professional privilege taxes that unnecessarily increase costs for advisors and inhibit investors’ access to advice.
Issues Impacting the Financial Services Industry
Regulation by Enforcement
Financial services firms, financial advisors and investors rely on consistent, predictable rules governing the regulatory road. Enforcement activity must not be used to establish new regulatory requirements, or what we deem “regulation by enforcement.” This includes new or evolving interpretations of existing obligations, which should be appropriately done through Notice-and-Comment rulemaking. The rulemaking process provides stakeholders with an opportunity to engage in the process and firms and advisors with the transparency and certainty needed to operate their business and protect their investors.
Alternative Dispute Resolution
We oppose any efforts that would make it more difficult for those who were named in a matter but ultimately deemed to have not been involved to expunge the matter from their public record. Lastly, while we support making harmed investors whole, we oppose any type of unpaid arbitration award pool, especially if funded by payments from honest industry participants. Instead, federal and state regulators should coordinate to permanently ban bad actors from providing any and all types of financial services to the investing public.
As more and more business transactions and communications are done online or through video conferencing, data privacy and security are more critical than ever. We support privacy laws that provide carve-outs for our members who comply with existing Gramm-Leach-Bliley requirements.
Advocacy Action Center
Our Advocacy Action Center is designed to help you get involved with simple but effective steps. There you can write a comment letter, identify your representatives in Congress, learn about FSI PAC and more.