Yesterday's announcement by LPL Financial that it would pay for a one-year membership in the Financial Services Institute (FSI) for all its 12,600 reps brings that organization's membership to about 27,000. The upshot is that FSI, which was spun off largely against its members' will from the Financial Planning Association (FPA) in 2003, now has more members than the organization from which it was spawned.

How many of the 12,000 LPL-affiliated new FSI members will renew their memberships remains to be seen. Whether the FSI, which in its early years was largely a broker-dealer advocacy and networking organization, can create compelling reasons for advisors to continue their membership is also an open question.

Over the last five years, FPA's membership has declined from 27,726 to 23,687 as of March. In 2002 after the International Association For Financial Planning merged with the Institute of Certified Financial Planners to create the FPA, the combined organization boasted 28,408 members.

LPL executives have their own motivations for the move, motives that have little to do with any nascent rivalry between FSI and FPA. (In fact, many LPL executives and reps are active in both organizations as well as the Foundation For Financial Planning, another non-profit spun out of FPA's predecessor organization, the International Association For Financial Planning.)

LPL reasons that FSI holds views that align more closely with their thinking on industry reform, and CEO Mark Casady told attendees at the independent broker-dealer that he now was spending several days a month in Washington, D.C., lobbying Congress and various agencies as they devise rules and regulations that are emerging from the mammoth Dodd-Frank bill that overhauled the structure of the financial services business. "We may favor meaningful reform that recognizes the benefits of independent advice," Casady said.

He also noted that he supports implementation of a uniform, harmonized fiduciary standard and agreed with the Securities and Exchange Commission's white paper on the subject, which some critics considered muddled and confusing. FPA also has long advocated for a uniform fiduciary standard for all advisors.

But LPL and FSI both believe that Finra is the logical regulator for brokers and RIAs, while FPA executives don't view Finra, which already oversees the brokerage business, as the most appropriate agency to regulate advisory activities. Instead, they have discussed the possibility of creating a new self-regulatory agency for this purpose. In an interview last March, FPA CEO Marv Tuttle acknowledged that his organization's advocacy stance had cost it members.

Both Casady and Bill Dwyer, president of LPL's broker-dealer and current president of FSI, urged LPL reps who share their views to contact their representative in Congress to voice their opinions. In the last year, Dwyer also has made numerous visits to the nation's capital and even visited the West Wing of the White House. "We urge you to continue to be involved," he told advisors.