Congressional Issues

On November 21, 2011, President Obama signed into law H.R. 674, which repealed an onerous 3% withholding tax that was enacted under the Tax Increase Prevention and Reconciliation Act of 2005 (P.L. 109-222) and which was set to take effect on January 1, 2013.

On September 13, 2011, William E. Dwyer, III, Chairman of FSI and President of National Sales and Marketing for LPL Financial, appeared at a hearing before the House Financial Services Subcommittee on Capital Markets to testify on Sections 913 and 914 of the Dodd-Frank Act.

On April 28, 2011, FSI sent a letter to Senator Tom Harkin, Chairman of the Senate Health, Education, Labor and Pensions Committee opposing S.770, the Payroll Fraud Prevention Act (PFPA).

On April 8, 2011, FSI submitted a comment letter to the SEC related to FINRA’s Proposed Rule related to the testing on certain Operations Professional. The Proposed Rule sets will establish a registration category and qualification examination requirement for certain operations personnel and will adopt continuing education requirements for such operations personnel.

On March 28, 2011, FSI submitted a comment letter to FINRA related to Regulatory Notice 11-08 (RN 11-08).

In late December 2010, FSI announced its endorsement of FINRA as the SRO for RIAs.

On April 12, 2011 FSI submitted Post Hearing Comments to the Department of Labor (DOL) related to a proposed rule to replace its longstanding regulation defining the circumstances in which investment advice confers "fiduciary" status under ERISA.

On Wednesday, April 6 the U.S. Senate passed a bill to repeal the 1099 reporting provision of the Patient Protection and Affordable Care Act.  

On March 3, 2011, the House of Representatives passed the Small Business Paperwork Mandate Elimination Act of 2011 (H.R. 4) by a 314–112 vote.

 On Tuesday, March 1, FSI sent a letter addressed to Speaker of the House John Boehner and Minority House Leader Nancy Pelosi, copying all other members of the House of Representatives, urging support of the Small Business Paperwork Mandate Elimination Act of 2011 (H.R. 4).

 FSI recently co-signed a letter drafted by the U.S. Chamber of Commerce regarding the launch of the new Consumer Financial Protection Bureau (CFPB).

The SEC has published their timeline for implementing a series of regulatory initiatives required under the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank).

On September 15, 2010, Senator John Kerry (D-MA) and Rep. Jim McDermott (D-WA 7th) introduced The Fair Playing Field Act of 2010 (FPFA) (S. 3786 and H.R. 6128).

FSI has previously reported on the status of the Taxpayer Responsibility, Accountability, and Consistency Act of 2009 (H.R. 3408 and S. 2882) introduced in the House and Senate by Rep. Jim McDermott (D-WA, 7th) and Senator John Kerry (D-MA), respectively. The core provisions of these bills make it more difficult for employers to classify workers as independent contractors.

FSI is co-sponsoring a forum on “The Fiduciary Standard in a Brokerage Setting,” with five other organizations. The event is scheduled to take place September 24 in Washington, DC.

The Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act), was signed into law on July 21, 2010. Among other things, the Dodd-Frank Act requires the SEC to conduct a six-month study on the impact of adopting a fiduciary duty for broker-dealers.

On July 21, the SEC held an Open Meeting to propose for public comment significant reforms to Rule 12b-1. The proposal is intended to address concerns that the fees no longer serve their intended purpose of supporting fund distribution, represent additional sales compensation, and are poorly disclosed to clients.

Last week, FSI filed an amicus brief in Taylor, et al. v. Waddell & Reed, Inc., et al. FSI‘s brief explains what the independent broker-dealer model is, how independent financial advisors function as independent contractors, and...

On Friday, June 25, 2010, the conferees from the House and Senate finished what they hope will be the final version of the financial regulatory reform bill. The bill contains a directive for the SEC to conduct a comprehensive study of all the issues involved in harmonizing the regulation of all providers of retail financial advice, including a fiduciary standard of care and enhanced supervision of RIAs.

Earlier this afternoon, the House and Senate Conference Committee charged with finalizing the financial services regulatory reform bill voted to require the SEC to conduct a comprehensive study of all the issues involved in harmonizing the regulation of all providers of retail financial advice, including a fiduciary standard of care and enhanced supervision of RIAs. If signed into law, the SEC would be required to report the results of the study to Congress within six months.

On June 17, 2010, FSI submitted written testimony and a statement for the record on a Senate hearing related to “Leveling the Playing Field: Protecting Workers & Businesses affected by Misclassification.” The hearing took place before the U.S. Senate Committee on Health, Education, Labor, and Pensions.

On June 10, 2010, FSI working with a coalition made up of 48 industry groups sent a letter to Conferees of both the House and Senate expressing strong opposition to the inclusion of provisions that would eliminate procedural safeguards that were imposed upon FTC rulemaking decades ago, after Congress determined the FTC had repeatedly overstepped its regulatory authority.

FSI has been working with several coalitions to influence the outcome of the independent contractor debate currently taking place in Congress (see below). FSI is a supporter of the Coalition to Preserve Independent Contractor Status.

The Senate bill, which is the base text of the conference regulatory reform bill, calls for the SEC to study and determine the appropriate obligations of brokers, dealers, investment advisers, and their associated persons relating to the provision of personalized investment advice about securities sales to retail customers.

The Senate is currently debating the Restoring American Financial Stability Act of 2010 (RAFSA). Debate and discussion of amendments to the bill are expected to run through the week of May 17, culminating in a final vote on the bill.

On April 22, FSI working with a coalition made up of 41 industry groups sent a letter to Senate leaders urging them to reject a proposal to give the Federal Trade Commission new rulemaking and enforcement authority over a wide range of industries as part of efforts to reform the financial services system.

On April 7, 2010, FSI submitted a letter to Senator Charles Schumer (D – NY) expressing interest in amendments he proposed to offer to the Restoring American Financial Stability Act of 2010 (RAFSA) passed on March 22 by the Senate Committee on Banking, Housing, and Urban Affairs. 

March 23, 2010
The Senate Banking Committee (Committee) approved the Restoring American Financial Stability Act of 2010 (RAFSA) by a party-line vote of 13 to 10. We are pleased to report that the bill passed by the Committee contains an FSI supported provision directing the Securities and Exchange Commission (SEC) to study all the issues surrounding harmonization of broker-dealer and investment adviser oversight.

The Financial Services Institute (FSI) applauds the inclusion of language proposed by Senators Tim Johnson (D-SD) and Michael Crapo (R-ID) in the Restoring American Financial Stability Act of 2010 directing the Securities and Exchange Commission (SEC) to study and then promulgate rules on important investor protection issues.

FSI is pleased to report that the revised Senate bill on financial regulatory reform calls for the SEC to study all the issues surrounding harmonization of broker-dealer and investment adviser oversight. This section replaces the requirement that all financial advisors become registered investment advisers.

On December 3, 2009, the House Committee on Financial Services consolidated six financial regulatory reform bills into the “Wall Street Reform and Consumer Protection Act of 2009” (WSRCPA). On December 11, 2009, the House passed the WSRCPA.  Among other things, the bill:

On December 23, 2009, Senator Tom Harkin (D-Iowa) introduced new legislation that would assess a tax on most securities transactions. The legislation, titled the “Wall Street Fair Share Act” (S.2927), is companion legislation to a House bill (H.R. 4191).

On February 17, 2010, FSI along with 31 other trade associations sent a letter the U.S. Senate, highlighting the belief that the creation of the CFPA is not the correct approach for consumer protection and that it will have severe unintended consequences for consumers, small businesses, and the economy. 

On September 30, 2009, more than 120 FSI members went to Capitol Hill for our Advocacy Summit.  Twenty-four teams held 100+ meetings with their respective Representatives and Senators. 

September 17, 2009

We are pleased to report that FSI members have submitted 2,272 comment letters expressing concern about HR 3408, the Taxpayer Responsibility, Accountability, and Consistency Act of 2009 and 2,200 comment letters in response to President Obama’s plan for regulatory reform.