2020 Advocacy Priorities
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. Our top advocacy priorities include:
ISSUES IMPACTING INDEPENDENT FINANCIAL SERVICES FIRMS & ADVISORS
Tax Treatment of Financial Services & Businesses: Independent financial advisors operate as independent contractors, and they choose this model for the freedom it provides them to operate their own business and offer clients comprehensive advice, products and services. We will work to protect our members’ independence by educating lawmakers on the importance of the independent broker-dealer model.
Also, as state and local governments look for ways to increase their revenue, we vigorously oppose any efforts to tax financial services or financial transactions. This also includes attempts to increase or impose professional privilege taxes on financial advisors.
Reducing Burdens on Business Entities Operated by Financial Advisors: We continue to seek relief from the SEC to allow the payment of commissions directly to business entities owned by financial advisors. In addition, we support nationwide access to association health plans, relief for small firms on PCAOB audits and updates to the SEC’s electronic delivery guidance.
ISSUES IMPACTING THE FINANCIAL SERVICES INDUSTRY
Standard of Care: We continue to support the implementation of Reg BI to ensure it improves investor protection while also supporting their access to professional financial advice and services. However, we strongly oppose state efforts to implement state-specific standards, which would result in a patchwork of varying requirements across the country. We are also monitoring the Department of Labor’s efforts to re-propose their revised standard of care, working to ensure it compliments Reg BI.
Regulation by Enforcement: Last year, we spoke out about the increasing trend of regulation by enforcement, particularly by the SEC. We continue to oppose enforcement activity that is based on staff guidance or creates new requirements without going through the formal rulemaking process. Additionally, we are working to ensure FINRA’s new exam program is effective, and that FINRA implements a “grace period” for firms to comply with Reg BI.
Federal Cybersecurity Requirements: Cybersecurity is a growing concern for our industry and regulators. We are working to ensure uniform, scalable cybersecurity regulations that allow for compliance by any size firm. We support a national data breach notification requirement that creates nationwide uniformity of reporting requirements and allows sufficient notification to states. In addition, we are working to address our members’ concerns regarding the confidential client information required for the Consolidated Audit Trail (CAT).
ISSUES IMPACTING CLIENTS
Retirement Security Solutions Provided by the Private Sector: With the looming retirement crisis, we continue to support reasonable efforts to improve Main Street Americans’ ability to save for a financially secure retirement. These efforts include working to restore the tax-deductibility of advisory fees and supporting state Multiple Employer Plans and voluntary state-run retirement plans.
Prevention of Financial Exploitation of Vulnerable Adults: Financial advisors are often the first to identify signs of possible financial abuse and need the proper tools for recognizing and reporting these abuses. We are working to help our members be better able to protect their clients by continuing to advocate for states’ adoption of NASAA’s model report and hold rule, which allows temporary holds on suspicious transactions and disbursements if financial exploitation is suspected.