The National Association of Insurance and Financial Advisors (NAIFA) applauds the unanimous approval of H.R. 7187, the Clarity for Compensation Act, by the U.S. House Committee on Financial Services. The bipartisan legislation, sponsored by Reps. Zach Nunn (R-Iowa) and Greg Meeks (D-N.Y.), passed the committee by a vote of 51-0 on June 30 and now advances to the full House of Representatives.

The bill, a top legislative priority for NAIFA that members advocated for during the association's Congressional Conference in May, would remove outdated regulatory barriers that prevent many registered financial advisors from receiving compensation through their own business entities. While lawyers, accountants, and insurance agents have long been permitted to operate under this model, many financial advisors remain subject to unnecessary restrictions that make it more difficult to build and sustain independent practices.

By modernizing these rules, the legislation will help independent advisors compete on a level playing field, strengthen small businesses, and expand access to financial guidance for consumers, particularly in underserved and minority communities.

"NAIFA applauds the Financial Services Committee for unanimously advancing this important bipartisan legislation," said NAIFA President Christopher L. Gandy, LACP. "Independent financial advisors are small business owners who deserve the same flexibility afforded to other professionals. Removing these outdated barriers will help advisors spend less time navigating unnecessary regulations and more time serving the individuals, families, and businesses that rely on their guidance. We appreciate Representatives Nunn and Meeks for their leadership and look forward to working with Congress to see this bill become law."

The Clarity for Compensation Act would:

• Remove outdated regulatory restrictions that prevent many independent financial advisors from receiving compensation through their own business entities.
• Align compensation rules for financial advisors with those already applicable to lawyers, accountants, and insurance agents.
• Support the growth of independent advisory firms and expand access to financial advice in underserved communities.

NAIFA supports policies that promote consumer access to trusted financial professionals while ensuring advisors can operate under regulatory frameworks that reflect today's business environment. NAIFA will continue advocating for passage of the Clarity for Compensation Act as it moves through the legislative process.