NAIFA Applauds GAO Approach: No Additional Layer of Regulation for Financial Planners is Warranted
Vice President, Communications & Marketing
Senior Director, Strategic Communications
FALLS CHURCH, VA (January 19, 2011) — The National Association of Insurance and Financial Advisors’ President Terry Headley, LUTCF, LIC, FSS, issued the following statement on the GAO report that examined oversight of financial planners. The report was mandated by The Dodd-Frank Wall Street Reform and Consumer Protection Act:
“NAIFA agrees with the main conclusion of the Government Accountability Office’s Consumer Finance Report that no additional layers of regulation for financial planning are required.
“We agree with the GAO’s findings that existing state and federal regulations already cover the vast majority of the services provided by financial planners, which include preparing financial plans and providing insurance products, securities, and other investments. Compliance with these regulations takes a large portion of insurance and financial advisors’ time and resources. Any additional layers of regulation would not only be unnecessary, but could also hinder the ability of advisors to effectively serve consumers.”
The GAO also found that consumers may not understand the significance of many titles and professional designations that financial planners hold, and asked the Securities and Exchange Commission to study the matter further.
“NAIFA strongly opposes anyone using professional designations or certifications in a manner that would mislead investors. Should the SEC heed the advice of the GAO report to look into this matter further, we hope the commission will consider an approach consistent with the NAIC and NASAA model regulations on the use of senior-specific certifications and professional designations. These models expressly prohibit the use of any designation or certification that is nonexistent, has not been earned or misleadingly inflates the knowledge or expertise of the person holding it.”
About NAIFA: NAIFA comprises nearly 700 state and local associations representing the interests of approximately 200,000 agents and their associates nationwide. NAIFA members focus their practices on one or more of the following: life insurance and annuities, health insurance and employee benefits, multiline, and financial advising and investments. The Association’s mission is to advocate for a positive legislative and regulatory environment, enhance business and professional skills, and promote the ethical conduct of its members.