Advocacy in action blog

NAIFA continues efforts to discourage the Department of Labor and the administration from moving forward with its flawed fiduciary-only rule. In a letter to DOL Acting Secretary Julie A. Su, Office of Management and Budget (OMB) Director Shalanda Young, and Office of Information and Regulatory Affairs (ORIA) Administrator Richard Revesz, NAIFA and 10 other groups detailed problems with the rule's regulatory process and asked the administration to "stand up for the integrity of the regulatory process and continue the public input process, rather than finalize the fiduciary rule now."

NAIFA is speaking out on behalf of financial professional and, particularly, the consumers who would be harmed by the Department of Labor's latest effort to reduce choices for Americans preparing for retirement. The fiduciary-only proposal, which is largely a rehash of a rule struck down by a federal appeals court in 2018, would radically change the financial services industry and reduce the ability of low- and middle-income retirement savers to access products and services.

The Department of Labor’s (DOL’s) current efforts to revive a fiduciary-only regulation for financial professionals is unnecessary and likely to harm low- and middle-income consumers by limiting their access to professional financial services, National Association of Insurance and Financial Advisors (NAIFA) CEO Kevin Mayeux, CAE, told officials from the Office of Information and Regulatory Affairs (OIRA) of the White House’s Office of Management and Budget (OMB).

“By moving forward with the Proposed Rule, OIRA and DOL are ignoring … the real-world experience that NAIFA members saw first-hand before the 2016 Fiduciary Rule was vacated,” Mayeux said. “If finalized, the Proposed Rule will again force financial professionals to move away from brokerage services into a fee-for-service model that is tailored to higher-income clients. This model simply does not work when a year-round fiduciary duty is imposed.”

NAIFA members are often at the forefront of efforts to improve Americans' financial literacy. From educating their clients to volunteering in local schools and their communities to promoting April as National Financial Literacy Month, NAIFA members are giving Americans intelligent insights into money matters. This even extends to their political advocacy.

NAIFA wholeheartedly supports a best interest standard for retirement investment professionals, but believes the Department of Labor's proposal to impose a fiduciary-only regulation goes too far, NAIFA Secretary Chris Gandy wrote in letter submitted to be part of the official record of a recent House Subcommittee on Health, Employment, Labor, & Pensions hearing entitled "Protecting American Savers and Retirees from DOL’s Regulatory Overreach.”

NAIFA is the leading advocacy voice for insurance and financial professionals at the federal and state levels. The association boasts members in every Congressional district and has a strong advocacy presence in every state capital. Last year, NAIFA tracked more than 490 state-level bills that had the potential to affect NAIFA members and the consumers they serve. NAIFA members or staff testified at more than 30 state-level hearings, providing real-world accounts of how policy proposals could benefit or harm the financial security of consumers. 

Senators Ted Cruz and Bill Hagerty have introduced legislation, the Protecting Innovation in Investments Act, that would prevent the SEC from moving forward with a proposed rule that would deter technological innovation by financial services companies. The SEC's proposal would also stifle financial professionals' use of technology to benefit clients. 

The Senators, in a release entitled "What They're Saying," quoted NAIFA President Tom Cothron, LUTCF, FSCP, on the importance of technology in the financial services industry and NAIFA's opposition to the SEC proposal.

NAIFA strongly supports newly introduced legislation, the Protecting Innovation in Investment Act sponsored by U.S. Senate Commerce Committee Ranking Member Ted Cruz (R-Texas) and U.S. Senator Bill Hagerty (R-Tenn.), that would foster the use of technology and innovation in the financial services industry to benefit consumers. 

When it comes to preparing for retirement, having choices matters. Congress, in recent years, has passed landmark legislation encouraging Americans to invest in their futures and save for retirement while giving them greater flexibility and more planning options. Now more than ever Americans need retirement planning assistance.

NAIFA members in a recent survey overwhelmingly said that the Department of Labor’s fiduciary-only proposal for retirement planning services would increase the costs of serving clients. That sentiment is borne out on a macro level by a new Financial Services Institute study conducted by Oxford Economics, which found that the rule would cost financial services firms $2.7 billion in the first year with continuing annual costs of $2.5 billion. These figures are more than six times the upfront costs and nearly 11 times the ongoing costs estimated by the DOL.