Regulated to Death... Life of an RR

[scagnt83]

Coming soon to a B/D near you...

Compliance meeting yesterday...

I now have to have a 15 digit password for my phone (my phone deosnt do alphanumeric passwords), two for my computer, and one for my email.... oh, and the password has to be approved "secure" by microsoft security systems....

Now all securities related email communications must go through my securities email or I will be fined.

They can now pull up to 6 months of bank statements.

They will be (or sometimes will) cross check fixed sales and bank records with our securities business; this is to look for commission sharing with non registered agents.


If you are a 65 you will have a new "business card pamphlet" (of course approved by the B/D & FINRA) that not only lists your business info but lists your education, credentials and every fine or infraction you have ever received.
(A friend of mine put his non securities email down on a VA app.... he got a $500 fine just for that!)

You can no longer pay referral fees in cash.

I barely made it over the "low production" mark last year, and avoided the $800 fine.... (I know a guy who did $450K in GDC for the year and got the fine)

I also pay more than double for E&O, plus there are yearly fees to the B/D...


I made a joke about when I get the recorded or monitored "securities cell phone"; the head of my osj looked at me and said "there has been talk of it already"

So why am I registered again??



Basically what is happening is that the SEC is being phased out and FINRA is being phased in more and more; on top of that it looks like regular RRs are going to be held to the same standards as a fiduciary eventually.

A birdie told me that the SEC will be gone in 2-3 years, their ineptness has pissed off Congress immensely; the irony is that the SEC is basically controlled by congress... lol


The future of this industry and the business models built around it will be changing drastically... they seem to want people to be 100% securities, or not.
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And to add to all of this, SC is one of the states that has adopted the new NAIC annuity suitability and education regs, not only do I have to do the state test, but I have to do product specific tests too!

Although this is more meaningful than anything on the securities side!

 

[BNTRS]

As a recently emancipated RR (this Month!) I am having what I think many mean when they refer to a religious moment. I can now pretty much do and say whatever I want. I have all sorts of new projects in the works concerning marketing, none of it would have been possible with a securities license.

I'm done with that ball and chain and couldn't be happier.

The extremely funny thing, I can now do things on the platforms I've always wanted to, but the B/D said hell no. The security is way better, and the motivation is now truly because I care about my clients' security.

 

[dgoldenz]

This is exactly why I will never have a securities license.

 

[Norwayguy]

A 15 digit password on your cell phone...man talk about ridiculous..What if the cell is just a standard cell and not an i-phone etc....The email issue has been around for a while. I ran into an issue with my securities email. The B/D wanted all correspondence with securities clients to be through the Securities email even if it was for a non-securities reason. I pointed out to them that the form they made me sign each and every year specifically stated that non-securities correspondence was prohibited on that email. The compliance guy looked at me and said these two requirements are not mutually exclusive you can meet both and I said yeah if I only have securities clients and nothing else. I can say dropping my registration in January was the greatest business decision I have ever made. No more dam blotters for me.

 

[scagnt83]

My biggest problem is not being able to do 401Ks.

In SC, 401Ks are actually not a registered product, but you are limited to an annuity based platform... which limits you to small market 401Ks if you want to be competitive.

But the industry is moving away from that and moving toward open architecture and fee based platforms, even in the small markets.

And the new disclosure regs rolling out this year will not help annuity based platforms, since they are usually more expensive (although they give the fiduciary more safety)

I am heavy in the business market and just really making headway in the 401K arena; it is supposed to be a vital part of my business plan moving forward...


If I could coordinate with an RR and actually have a way to get paid, it would be great; but that is not looking likely.
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The compliance guy looked at me and said these two requirements are not mutually exclusive you can meet both and I said yeah if I only have securities clients and nothing else.

Exactly!

They are consolidating the securities industry agents to RRs who are only 100% securities.
The insurance agent who does $400k in VA biz per year will be an endangered species very soon.
Also, look for the career shops to be dropping their BD side of things or spinning it off.
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And I should have stated the email situation better; its the same thing as mentioned.

If I have a life client who just bought a VA from me; now I have to email him only from my securities email, even if it has nothing to do with the VA or registered biz

 

[redkee]

I looked into getting a securities license a few years ago;the added expense&BS turned me off. CMS is a pia for any agent wanting to sell senior health. Uncle really wants to put us all out of business;it doesn't matter what you want to sell.

 

[somarco]

My biggest problem is not being able to do 401Ks.

How about charging a consulting fee instead?

I got out of the pension business years ago before all this got out of hand. Dealing with ERISA fiduciary regs was bad enough. Can't imagine why anyone would want to put up with this kind of BS.

 

[xrac]

The FINRA requirements are both stupid and outrageous. To become a RR means surrendering your freedom.

 

[Charpress]

I made one of my rare, last-minute appearances on the FINRA site to authorize a transfer to an account to pay state fees. Naturally, I was trying to do this at night since a deadline was coming quickly.

Oops, FINRA locked me out since I hadn't done a mandatory password change in 6 months.

We used to call stuff that was absurd to the point of comedy Micky Mouse. I think that applies to much of what we see happening.

If people are paid a salary to regulate, then that is what they are going to do just to protect their jobs.

 

[VolAgent]

Its hard to ask for a budget increase or a raise when you say that everything is fine and no additional regulation is needed.

Also, you can't allow any blame to be put on failure to enforce existing regulations. You have to get something new in place.