The Financial Planning Association is in the earliest stages of reaching out to associations and regulators as it presses forward with its strategy to seek legal title protection for financial planners, FPA Chairman Skip Schweiss said during a webinar hosted by the Institute for the Fiduciary Standard last week.
“We are in the very early stages of reaching out to various parties in the financial services industry to have conversations about what different organizations and thought-leading individuals think this should look like,” Schweiss said.
The next step “is to really confer with all these entities about what their thoughts are and I think that is where we flesh out where the opposition might be, where the ‘gee we’d support you if it looks like this, but not like that.’ We’re just in the very early days at this point,” added Schweiss, who is also CEO at Sierra Investment Management.
If a professional is going to call him- or herself a financial planner, “you ought to have certain credentials. Consumers instinctively know that I can’t just call myself a doctor. We think that ought to be the case with financial planners as well,” he said.
The FPA understands this is an uphill battle. “Please make no mistake about it. Title protection is a major undertaking that will likely take many years of hard work, perseverance, and, more importantly, unwavering leadership by FPA as the Association that is committed to the legal recognition of financial planners,” FPA President Dennis J. Moore said in a statement.
The FPA recognizes “that not everyone in financial services will share this same bold vision, and we accept that. But we know this is what’s right for our members, consumers, and the profession of financial planning,” Moore added.
Pundits on the panel, including Financial Advisor Magazine Editor-in-chief Evan Simonoff, Jeffrey McClure, an investment advisor representative with Personal Wealth Coach in Salado, Texas, and moderator and Institute President Knut Rostad, said they agreed the goal is worthwhile, but fraught with numerous bureaucratic landmines.
Chief among FPA’s challenges is whether to pursue title protection at the state or federal level, Simonoff said.
“The issue that I see ... is how best to achieve this. It appears [the FPA would] want to do this on a federal level, which would obviously be the most efficient and effective, but I also don’t know how realistic that is. Getting Washington to focus on something like this is not an easy task,” Simonoff said.
“Is there a feeling that if the FPA were able to get a few big states, say California, New York, Florida and a handful of others to embrace this ... that it could become a fait accompli? Or is this going to take a big bear market and something like another financial crisis and millions of Americans to suffer fairly irreparable financial damage, to get lawmakers’ attention?” he asked.