The association's witnesses advocating to preserve consumer choice in financial services models include a practicing advisor and his client.
ARLINGTON, Va., Dec. 12, 2023 /PRNewswire-PRWeb/ -- National Association of Insurance and Financial Advisors (NAIFA) President Bryon Holz, CLU, ChFC, LUTCF, CASL, LACP, testified today along with his client, Chuck Ross, at a Department of Labor public hearing on the DOL's fiduciary proposal known as the "Retirement Security Rule: Definition of an Investment Advice Fiduciary." He is one of the only actively practicing financial advisors to testify during the hearing and the only one to testify along with a client. Together, they gave a first-hand account of how the proposal will harm consumers.
"Nearly all of NAIFA's members and many of our clients will be significantly impacted by the Department's proposal, with lower and middle-income savers hit the hardest," Holz testified. "By moving forward with this proposed rule, the department is ignoring the negative impact this rule will have on lower and middle-income savers and the real-world experience that our members saw first-hand before the 2016 Fiduciary Rule was vacated. The proposed rule would again force advisors 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."
Holz draws on more than 40 years of experience as a financial professional. His practice helps Main Street American families prepare for retirement, giving him a direct understanding of how the DOL proposal will impact his business and consumers.
"We value his expertise and know that Bryon puts our best interest first," said Ross, who along with his wife has been Holz's client for nearly four decades. "But, unfortunately, that relationship and advice, particularly when we were just starting out, with only limited assets at the time, would likely not be possible for others in a similar situation today if this proposed rule moves forward."
Holz cited preliminary results from an ongoing survey that found 70% of NAIFA members currently impose no minimum asset requirements on retirement planning clients. If the DOL proposal is enacted, the percentage of respondents who believe they will continue to be able to offer no-minimum asset requirements drops to 28%.
The DOL proposal would limit the ability of consumers to choose from a variety of financial service business models. It would prevent many lower- and middle-income investors from receiving advice and services altogether. It is also entirely unnecessary. The SEC's Regulation Best Interest and National Association of Insurance Commissioners' model for annuity transactions, which has been adopted by more than 40 states, require financial professionals to work in their clients' best interests.
More than 250 NAIFA members met with their members of Congress and senior staff on December 5 as part of NAIFA's National Leadership Conference and shared their concerns about the DOL proposal. NAIFA CEO Kevin Mayeux has had similar discussions on the proposal with the White House. Should DOL decide to move forward with the rule, it will be a key topic of discussion at NAIFA's annual Congressional Conference, May 20-21, when more than 500 financial professionals will take NAIFA's advocacy message to Capitol Hill meetings.
CEO Mayeux has said NAIFA will explore all options to preserve consumers' ability to choose from a variety of financial service models.
ABOUT NAIFA: Founded in 1890, the National Association of Insurance and Financial Advisors is the preeminent association for financial service professionals in the United States of America. NAIFA members, in every Congressional district and every state house, subscribe to a strong Code of Ethics and represent a full spectrum of practice specialties to promote financial security for all Americans. Complimented by its professional development and consumer divisions, the Society of Financial Service Professionals, and Life Happens, the association delivers value through advocacy, service, and education.
Media Contact
Mark Briscoe, NAIFA, 703-770-8111, [email protected], www.naifa.org
SOURCE NAIFA
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