The SEC says it proposed its initiative to ensure that brokers operate in the best interests of their customers and disclose conflicts of interest, including their business and compensation practices.

The coming dust up is likely to pit NAIFA against consumer and financial planner groups and even some regulators who believe the SEC’s so-called “best interest” proposals don’t go far enough because they require only registered investment advisors to operate in a fiduciary capacity when working with investors. In contrast, brokers and dually registered reps would be subject to the lesser “best interest” standard, which is not defined in the proposal, critics say.

In fact, a coalition that includes the CFP Board of Standards, Consumer Federation of America and the North American Securities Administrators Association wants the SEC to ensure that the agency’s “unequal standard for securities professionals” is clearly and effectively conveyed to investors in the agency’s customer relationship summary (CRS) proposal. The SEC will be testing the CRS proposals with investors, and the coalition wants the proposal’s comment period delayed until 90 days after the test results are made public.

If past lobbying and legal success is any indication, NAIFA will be a formidable opponent in this debate. And it is no stranger to coalition building, working with the American Council of Life Insurers (ACLI), the Financial Services Institute (FSI) and the Securities Industry and Financial Markets Association (SIFMA) and a multitude of other co-plaintiffs to finance the lawsuit that finally defeated the DOL fiduciary rule in the Fifth Circuit Court of Appeals in New Orleans March 15.

NAIFA remains well-girded for battle. It dispatched 850 agents and advisors from all 50 states to meet with lawmakers and their staffs May 23 to discuss the importance of preserving their ability to deliver financial products and advice to Main Street Americans. Between the ACLI and NAIFA, the insurance industry delivers insurance, annuities and other products to more than 90 million Americans, the associations said.

A reminder from NAIFA CEO Kevin Mayeux that the group had been victorious defeating the DOL fiduciary rule was greeted with deafening cheers and fist pumps at a pre-lobbying policy briefing the day before agents swarmed Capitol Hill.

The well-oiled annual lobbying operation, months in the scheduling, was aided by policy powerhouse ACLI, which paid for a full-page ad in Politico announcing NAIFA’s members’ “fly-in” to lawmakers and staff. 

“ACLI consistently supports NAIFA’s annual fly-in of more than 850 agents,” said Alane Dent, ACLI’s acting senior vice president, federal affairs, calling NAIFA and ACLI “natural strategic allies, working in tandem on many high priority issues affecting American families and the life insurance industry.”