Grass-Roots Group Takes On DOL Fiduciary Proposal

Advisor Anthony Petsis is well known for being passionate about financial issues that impact his clients, pro or con. That includes the proposed fiduciary regulations from the Department of Labor (DOL) which would, among other things, expand the fiduciary standard of care to financial advisors.

When he first read the regulations, “I was almost in disbelief,” said the Newton, Pa. advisor in an interview with InsuranceNewsNet. “Where did these ideas come from?”

One thing led to another and soon Petsis became a co-chair of a new non-profit that is seeking to raise awareness about the harm the proposed rules could do to mid-market Americans if adopted in the current form.

Grass-roots initiative

Called the Coalition to Protect Retirement Security and Choice, this is a grass-roots initiative from the local advisor’s perspective, said Petsis.

“I hear that Washington is very concerned with small-town America. We are on the front lines with our clients,” and so can provide that perspective, he said.

In his own case, he said he has been in business for 35 years. When he walks down the street in suburban Philadelphia, he said, he often sees the people he has helped over a lifetime.

“I have many stories about helping them and their businesses,” Petsis said.

Some are people who never thought they would be able to retire or business owners who needed help with a retirement program for their employees, he added.

It’s important that regulators learn what happens in advisory services at the local level, and to know how advisors view the proposed regulations, Petsis stressed.

In its current form, the proposal “will make it harder and more expensive for many Americans to get trusted retirement advice,” and will severely limit access and choice, he said.

“Low- and middle-income savers, like most of my clients, will be forced to either pay higher prices for fee-based services or will be pushed to impersonal, computer-operated robo-advice.”

That is a key part of the message the coalition aims to deliver. “Crucial changes” need to be made to the proposal in order to avoid unintended consequences, it says.

Petsis said his broker-dealer at Transamerica suggested he look into joining the coalition. This was because he is so passionate about the issue. The issue is so important, he said, that he has decided to make himself “available to talk with anyone (about this) who will listen to my opinions,” whether it’s a friend, client, family member, professional contact, or someone from a newspaper.

“I’ll talk ‘til I am blue in the face,” Petsis said, adding that if someone needs him to attend a meeting on the subject, he plans to go.

The coalition

Petsis is not alone in his advocacy -- the coalition has nine co-chairs in all. It also has a steering committee of more than 30 local financial advisors and insurance agents, who are in turn networking with others in their fields and with various organizations.

The coalition reports that it represents “thousands” of local advisors, but did not provide a specific number. To trigger action, the coalition has created a website that features a petition on the home page for concerned visitors to sign.

Though posted for just a couple of weeks, the petition has already gathered more than 243,000 signatures from citizens in 30 states, according to the group. The signatories include not only industry professionals but also individuals, businessowners and others. That is why the coalition refers to the signers as “citizens.”

Most of the signatures currently come from California, Florida, Michigan, Illinois and Maryland.

Depending on how “robust” the numbers get, the coalition may decide to take the petition to Washington. For now, Petsis said the focus is on building awareness.

Joining in the discussion

He conceded that many insurance and financial industry organizations have already filed comments with the DOL about changes needed to the proposed regulations. But Petsis sees no conflict with the coalition joining in the discussion, bringing a local voice from “citizens” across the country to join the “many organizations” that have concerns.

“My thought is, you can never have too many minds and too much feedback, especially regarding a regulation that will make retirement for the average person more expensive and establish obstacles for employers that have plans,” Petsis said. “We think it’s positive to have more voices on this issue.”

The initiative is a project of the American Council of Life Insurers, according to the coalition website. Several carriers have partnered on the project along with agents and advisors.

InsuranceNewsNet Editor-at-Large Linda Koco, MBA, specializes in life insurance, annuities and income planning. Linda can be reached at [email protected].

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Linda Koco, MBA, is a contributing editor to InsuranceNewsNet, specializing in life insurance, annuities and income planning. Linda can be reached at [email protected].