Objective information about retirement, financial planning and investments



  1. Roger:

    You have provided an excellent summary to the issues the DOL is trying to address. In the perfect world, the industry would have dealt with this issues a long time ago, but we didn’t. We deserve everything we get as a result.

    This is not about the increased costs of compliance. The “suitability” world, as I think of it, has saddled themselves with very high fixed costs that only extraordinarily high fees can cover. They know that a fiduciary standard will eat into those high fees, thus the fear.

    • Roger Wohlner says

      Thanks for your comment John. I’ve frankly never understood how “suitable” was an acceptable standard. Anything less than acting in every client’s best interests to me is unacceptable. Sadly I think the brokerage world will find ways to make this work to their benefit. I will be interested to see what the final version of the rules looks like.

    • Now you suitability sales sharks will have to retool and become advocates of the Fiduciary Standard: We in the no-load community welcome you with our fruit salad table in lieu of the shrimp you have been accustomed to.

      • Roger Wohlner says

        Joel I’m pretty confident in saying the John Whaley is not a “suitability” type. His firm does an excellent job for their clients and they are one of the good guys.

        • Joel L. Frank says

          I assure you that my remarks were not directed at John Whaley but rather to the vendors of retail priced mutual funds/variable annuities that prey on the low-information HR person and get him/her to allow their expensive products to be sold to employees.

          Case in point is the State of New Jersey signing off on a five year deal to have Prudential Financial sell its commission based funds to NJ State Employees via the State’s Deferred Compensation Plan.

  2. “Shouldn’t all financial advisors always put their client’s interest first?”


    It seems obvious to me and I think it should be obvious to other, yet a large percentage of “financial advisors” still choose to not respect their clients’ best interest and instead decide to swim in the gray area of a suitability standard. I’ll never understand it.

    Good summary, thank you.

    • Roger Wohlner says

      Thanks for your comment Mike. I will never understand the suitability standard either and thankfully it looks like this will largely be going away.

  3. Great summary and thoughts. Really, really well done.

  4. I have long believed that if the annuity salesperson had to tell the prospect that annuitizing means you know longer have the title to your premium but have exchanged that title for a fixed/variable lifetime income annuitizing would collapse. What say you?

    • Roger Wohlner says

      Joel thanks for the comment. I would hope that any annuity sales person, broker or registered rep would have fully explained this to their client. I can’t imagine them not doing this, but I have seen stranger, more disturbing practices I guess.

      • Joel L. Frank says

        Thank you Roger and as a follow up:

        But does the Annuity Contract disclose the fact that annuitizing means the annuitant has transferred to the insurer the title to the premium in return for a lifetime income? Does the new BIC require this disclosure in writing?

  5. As we speak loaded mutual funds and variable annuities are being sold to millions of people that save via the Defined Contribution plan community, including IRA.
    These individually controlled investment accounts total about $12 trillion.

    Q.: Are these sales a violation of the BIC? What is the future of this commission based industry?

    • Roger Wohlner says

      The actual rules regarding the BICE contract were changed a bit in what was released today and I’m still going through these to see what is included and not included.

  6. Joel L. Frank says


    Does the SCOTUS decision in Tibble v Edison International outlaw the practice of placing loaded mutual funds on the plan’s investment menu?

  7. Roger,
    Thank you for this article you summarized it very well. I have been in the the business for 19 years having started with a major wirehouse and I am an independent. Some of these new rules are long overdue. I met with a prospect last night who has a VA in her IRA (large amount), it is down 25%, she is paying 3.66% in annual fees plus the subaccount fees are 2.61%, and a seven year fee schedule for the “bonus recapture”, and this was done as a transfer/exchange which the prospect did not understand the CDSC clock starts over. His compliance may have felt it was “suitable” but it was only in the best interest of the Advisor. Sadly, this is not the first time I have seen such things. I am glad to see these regulations, this business is hard enough but the “rogue” Advisor’s make it twice as tough.
    I have no doubt the major wirehouses will raise their fees due to this ruling, they did after several of the Dodd Frank items were enacted I was still at one. The brokers were whining then about Form ADV other other fee disclosure documents on the managed accounts (which they would remove from the paperwork they gave the client — little did they know the client received a copy of all of it from home office!). I have always been upfront and honest about how much the fee would be and make sure the client is comfortable with it.

    Again thank you

    • Roger Wohlner says

      Cindy thanks for the comment and glad you found the piece useful. I have seen some horrible financial products over the years but the VA you described is far and away the worst product I’ve ever heard about. I can’t imagine this even meeting the suitability standard, but I’m also not surprised.

      While the final version released yesterday was watered down from draft version, I think (hope) these rules force some of these brokers and their firms to rethink how they do business and more importantly to help shed light on some of these practices for the investing public.

  8. Welcome comments… however what about clients who were paying reasonable fees in mutual funds (less than 1% annually) were getting good advice , guidance , and help. Now they are considering a fee based account , with a wrap fee , because it meets the definition of “fiduciary”. Otherwise, your on your own. Big reality I’m afraid.

    The law should target those advisors and products that are at the heart of the issue.

    • Roger Wohlner says

      Thanks for your comment. Assuming these rules do get implemented under the new administration, I’m not sure the situation that you described will be impacted. I may be misunderstanding your comment though. The rules are not perfect but they are a step in the right direction in my opinion.


  1. […] the introduction of the new Department of Labor Fiduciary rules, financial advisors will be required to put their client’s interests first when providing advice […]

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