fi360 Blog

Fiduciary Links: Conference Wrap Up

If it seems we’ve been hitting you over head too much about our conference over the past couple of weeks on the blog, we apologize, but this’ll be the last time we give it the full feature treatment this year, we promise. The event is the culmination of year-long process to bring it all together that involves the efforts of almost our entire staff and we believe the results speak for themselves. As fi360 has grown, so too has our conference. It has been a huge part in growing the societal culture amongst our membership of investment advisors and other financial services professionals who share their pursuit of self-improvement, fiduciary ethics and improved processes for the benefit of investors. If you are a follower of fi360 and have never been to one of conferences, I strongly suggest you consider it. You won’t find another conference experience quite like it.

That said, here are some conference wrap-up links to check out and get a little sense of this year’s activities:

• We live-blogged the conference on Thursday and Friday. If you were following on those days, check them out again as I’ve added some additional nuggets and links. You can also check out our Twitter feed for some live updates we sent on those days.
• AdvisorOne coverage of Senator Dodd’s keynote address.
• Dodd also gave an interview to AdvisorOne’s Kate McBride.
• Michael Montgomery won the annual article competition for his article on Multiple Employer Plans. His winning article can be found on AdvisorOne and all entries can be read on fi360.com.
• Coverage of Mercer Bullard’s session on the Self-Regulatory Organization for Independent Investment Advisers.
• A story about a 16-year “breakaway cycle” that really got moving at an fi360 Conference. Just one example of relationships forged at our event. Did you know that the genesis of the Committee for the Fiduciary Standard occurred at an fi360 Conference?
• You can still find presentation slides from this year’s event on our agenda page.

And, with that, we’d like to say thanks to everyone for making this year yet another successful fi360 Conference. Everyone from the fi360 Conference Committee, the fi360 Staff, all of the speakers, moderators, attendees and more contribute to creating the unique atmosphere and we look forward to it again next year. If you have any questions or comments about this year’s event, let us know in the comments or by emailing conference@fi360.com.

Now on to the best links from the past week:

fi360 Conference, Day 2

Day 2 of the fi360 Conference is underway (see day 1 notes here). Last night featured another networking cocktail reception and some organized trips to the San Antonio Riverwalk. Today's lineup features keynote speaker Peter Elkind and the awarding of the inaugural Tamar Frankel Fiduciary of the Year Award from the Committee for the Fiduciary Standard.

3:00 p.m. breakouts: The last breakout of the conference features Dan Bernstein of MarketCounsel making sense of regulation, another session on understanding DOL audits from Ed Lynch's crew and TDF investing with the expert Ron Surz.

The conference draws to a close soon and we want to thank everyone who was with us in San Antonio or followed us on the blog or on Twitter. Once again, the conference was an overwhelming success. If you have never been to our event before, we encourage you to come try it out. You won't find a better gathering of investment advisors anywhere. It's a great chance to hear some great content from an agenda chosen via an extensive selection process and interact with some of the most innovative and conscientious people in the industry. Check back to these blog posts next week, we'll clean them up with some good links and other information. 

1:45 p.m. breakouts: Duane Thompson spoke following lunch on one of the two things you don't typically want to get a look at (sausage being the other): law being made, fiduciary in this case. Duane, of course, was involved in FPA's successful campaign to overturn the broker-dealer exemption. Also in this time slot were Barbara Lewis on marketing, David Blanchett of First Affirmative on SRI and Financial Service Standards on applying prudent practices.

11:00 a.m. breakouts: fi360 Conference hall-of-famer Fred Reish was up before lunch discussing DOL's fiduciary definition proposal and its implications to advisors. This was a similar topic to the webinar he did with us in March. We also had our economic forecasting session from Jeff Cleveland of Payden & Rygel, and Ed Lynch's group discussing the CAFE.

Jeff Cleveland is a senior economist for Payden & Rygel, which has a fairly deep and developed library, including economic forecasts available from their website. Along with some caveats to the reliability economic forecasting, Jeff offered a relatively optimistic view of the economy.

In their first session of the day, Ed Lynch & Co. looked at how the CAFE is an effective assessment and business development tool, but how even trained analysts sometimes need a little help.

9:30 a.m. breakouts: Following up on his award presentation, Ron Rhoades took the stage during the first breakout timeslow to discuss form adv, part 2 and how they relate to your investment strategies and product due diligence. Speaking of which, Knut's introduction to Rhoades included a reference that his own form adv is a must see. You can see it featured prominently at the Joseph Capital website.

Also in this time slow were sessions on professionally managed accounts from Greg Kasten and Jim McMichael, professional codes of ethics from Mark Mensack and informed consent from Johann Klaassen.

The managed account sessions asks the fundamental question of how an employer can move beyond just providing a 401(k) to ensuring that their employees are able to meet their retirement needs.

The code of ethics session looked at just how far down the perception of the professionalism of financial services providers is and how individual providers can rise above those numbers by learning from the codes of ethics from the variouis leading professional groups, such as fi360, CFP and ASPPA.

Conference staple Johann Klaassen of First Affirmative is looking at how fiduciaries must ensure their clients understand the investment policy in a way that they can make informed decisions, much like a doctor must ensure his or her patients understand a proposed plan of treatment before proceeding. Johann framed the information discussion in terms of potential complications, alternatives, risk and benefits. An example of framing he raised comes the linked passage from Jason Zweig's 2007 book Your Money and Your Brain: How the New Science of Neuroeconomics Can Help.

Peter Elkind: Day 2's general session featured Fortune columnist Peter Elkind. He spoke from his experience investigating and writing on Enron and Eliot Spitzer to illustrate how individuals and cultures influence ethics and compliance around them. His session was followed up with a book signing where both his Spitzer and Enron books were available for inscription.

Elkind's approach was a good counterbalance to the Dodd session the previous day. Whereas Dodd stressed compliance and a procedural approach to dealing with the problems that caused the financial crisis, Elkind stressed the importance individuals can play in building the right culture of high ethical standards. We'll have copies of both of his books available in our online store soon.

Tamar Frankel Award: The day kicked off with Knut Rostad of the Committee for the Fiduciary Standard awarding the first Fiduciary of the Year Award to Ron Rhoades. After a nice intro to Tamar and her works and why the award was named for her, Knut introduced Ron with a summary of his prolific efforts to explain and advocate for the fiduciary standard.

 

2011 fi360 Conference, Day 1

Welcome to everyone at the fi360 and to those following here on the blog. We kicked off last night with check in and a cocktail reception in the beautiful Texas weather. We've already completed AIF and AIFA training, CEFEX analyst training, and updates on the fi360 Toolkits. We'll be live blogging updates on this page throughout the day, so check in often. If you are at the conference and active on Twitter, use the hashtag #fi360_2011 so we can see you and we'll retweet your updates as well.

4:15 p.m. breakouts: Last session of the day now underway. Mercer Bullard is discussing the current oversight landscape for advisors and how SROIIA will act as the higher standard alternative to FINRA, Stephen Lansing and Peter Gulia are discussing computer models for PPA advice, NAPLIA and Marcia Wagner are covering ERISA bonding and our own Tools team is doing a demo on modeling software.

Mercer says that an SRO for advisers needs to be in place before the SEC authorizes self-regulation or else FINRA will be the SRO. Announces that fi360 has agreed to provide a fiduciary exam; hints at possible role for CEFEX.

The Lansing-Gulia PPA advice session starts off with a pretty good list of more than a dozen RFP questions for advice and managed accounts for the consideration of the audience.

2:45 p.m. breakouts: Midway through the afternoon and we have breakout sessions on CEFEX assessments from the always-entertaining Scott Reed, a session on value standards from Fiduciary Benchmarks CEO Tom Kmak, Liza Horvath on investment policy for trusts, and an update on fiduciary reform from Committee for the Fiduciary Standard founder Knut Rostad.

Tom Kmak is kicking off his session by comparing increasing MPG on automobiles to the maturation of value standards in financial services. "Value standards propel an industry forward," says Kmak, listing performance, people, process and price as value standards for our industry.

Carlos just finished an update on CEFEX activities, including insurance premium reduction, form ADV help, CEFEX fact sheets and profiles and more. Scott Reed now taking the stage to talk about how to leverage fiduciary assessments to generate consulting business. Of course, Scott's presentations always include a little rock 'n roll. He is also handing out Jezebel Pesticide envelopes that contain one of our fiduciary cards.

Just saw our first media coverage from the conference, from AdvisorOne's Kate McBride, who is here in San Antonio. On the Senator Chris Dodd keynote address.

Bob Clark just followed Knut Rostad at the Committee for the Fiduciary Standard's session, commending the audience, the Committee and fi360 on their job advocating for the fiduciary standard. Clark is, of course, a staunch advocate for the standard. Speaking specifically on the large obstacles of overcoming the huge financial service industry. As always, he is both skeptical of the ability for the pro-fiduciary side to win, but hopeful nonetheless.

Liza Horvath's investment policy for trusts and endowments session seems to have struck a chord as it is very well attended. Some of her listed underpinning for endowment investment policy include: economic conditions, tax consequences, other resources, inflation/deflation, expected returns, the role of each investment in the portfolio and the needs to make distributions and preserve capital.

1:30 p.m. breakouts: The first post-lunch sessions are under way. ERISA attorney and fi360 Conference staple Fred Reish is talking 408(b)(2), Katie Umile is discussing how to leverage fi360 designations and software to win new business, and Kevin Mahoney's session is on transitioning from the suitability standard to a fiduciary standard from a wirehouse. Plus we've got an fi360 Toolkit demo going on.

Katie Umile drove home her point on selling yourself by giving out free beers as attendees walked in the door. She also has some very nice things to say about fi360, saying the monitoring reports (see bottom of that link for a sample) from the toolkits give plan sponsors everything they need in an easy to use format from an independent source.

Fred Reish is discussing 408(b)(2) disclosures and agreements and when advice becomes individualized under ERISA. He partially covered this topic in his webinar in March, a recording of which can be found here.

10:30 a.m. breakouts: For our first lineup of breakout sessions, we have Ron Rhoades on retail advice, the gentlemen from Envestnet on practical advice for an industry in transition, the Platinum 401k Group and Scott Pritchard on multiple-employer plans and Professor David Upton on Sharia finance.

Professor Upton says 70% of Muslim investors would prefer to adhere to Sharia law in their investing, a challenge, but significant opportunity for fiduciaries.

MEP session discussing how to deal with a single bad apple in a multiple employer plan. Mike Montgomery, our article competition winner, is a member of this panel, which includes his partner Terrance Power from the Platinum 401k and Scott Pritchard, who has previously participated in an fi360 webinar.

You can find more information on Ron Rhoades' topic in the following letter he submitted to DOL on their fiduciary advice rule proposal.

Opening remarks: The conference opened up this morning with remarks from COO Rich Lynch and CEO Blaine Aikin. Rich introduced the fi360 staff and shared the newest developments from fi360. Blaine did an update on the state of the industry, noting progress towards a strong fiduciary standard and the challenges still ahead.

AdivsorOne wealth editor-in-chief Kate McBride then took the stage to honor Mike Montgomery, who won the 2011 fi360-AdvisorOne Article Competition for his article on multiple-employer plans. You can read his article here and the other entries from our deep pool of competitors here.

Keynote speaker Chris Dodd is on stage now discussing the evolution of the Dodd-Frank Act from the financial crisis until now and how a balance must be struck between fostering innovation and reforming a wild west culture with legislation and regulation.

 
His stated goals for legislation include:

1. A new framework to suit the modern financial system
2. Don't strangle innovation.
3. International harmonization of rules.

AdvisorOne covered the address in this article, noting Dodd's remark that he wanted to get SEC self-funding into the bill, but wouldn't have been able to get it passed.

Answering your questions on 408(b)(2) and fiduciary advice

A few weeks ago, fi360 and CEFEX hosted ERISA attorney Fred Reish for a webinar on proposed DOL 408(b)(2) and fiduciary advice regulations. During the session, Fred covered what constitutes fiduciary advice under the new rules and what doesn't, what constitutes a prohibited transaction, and upcoming disclosure requirements. A recording of the webinar and the slides are now available for download on our website.

The session led to many questions from the audience looking for further insights into how the rules apply in specific situations that we were unable to address in the time allotted. Fortunately, Fred was kind enough to answer some of the most frequently asked and generally applicable questions, which we are happy to present in the following Q&A:

Fiduciary Links: Center of fiduciary universe will be in San Antonio this May

For the seventh consecutive year, fi360 is playing host to many of the most innovative thinkers and influential figures on the subject of investment fiduciary responsibility. You won't find better fiduciary content or a higher caliber audience of financial servicse professionals at any single event than you will at the fi360 Conference. We have just released our complete agenda and wanted to take a chance to highlight some of the great speakers and topics that we'll be covering this May 4-6 in San Antonio.

Our two keynote speakers this year are Senator Chris Dodd, who will be discussing the fiduciary implications of the Dodd-Frank Financial Reform Act, and Fortune columnist Peter Elkind, who is the author of books on both Enron and Eliot Spitzer and will be discussing ethics in business and in Washington. Other prominent speakers and topics include Professor Mercer Bullard on his SROIIA project, ERISA Attorney Fred Reish on DOL fiduciary advice and disclosure regulations, columnist and advisor Ron Rhoades on retail advice and Form ADV requirements and former FPA managing director Duane Thompson on lobbying for a fiduciary standard. Also being covered are sessions on SRI, economics, target-date investing, professionally-managed accounts, multiple-employer retirement plans, ethics, benchmarking, computer-based participant advice, fiduciary auditing, fiduciary liability insurance, Sharia investing, investment committee best practices and more.

This year's conference also includes the awarding of both fi360's Article Competition prize and the inaugural Tamar Frankel Fiduciary of the Year Award from the Committee for the Fiduciary Standard. Networking opportunities include evening cocktail parties and post-conference golf outing at the resort's PGA Tour TPC course.

Registration to the event is open to the public and we'd be happy to answer any questions you may have. In addition to the conference itself, we'll be hosting other educational opportunities all week long, many of which qualify for CE credits for leading professional credentials. So take a look at our conference web page and see all that this year's event has to offer. You won't regret attending this unique event.

Now on to the rest of the best links from the past week:

Live blog from day two of the fi360 Conference

Day two of the conference is underway. The day kicks off with Mercer Bullard speaking on the legislative and regulatory future of the fiduciary standard of care followed by another full day of breakout sessions. Just like yesterday, we'll be live blogging throughout the day, posting some of the best quotes as updates to this post. If you are on Twitter, you also can follow the action from us @Fiduciary360 as well as from other live attendees. Search for the hashtag #fi360_2010 to get the latest updates.

Update 4:00 p.m.: And that's it for the 2010 fi360 Conference. Thanks for following us and thanks to all the speakers for their contributions and the 450 attendees that made this our biggest conference yet. The conference was recorded, so all AIF and AIFA designees can look forward to seeing those recordings made available in the portal within the next few weeks. 

Just a reminder, we announced the other day that the 2011 fi360 Conference will be held in San Antonio on May 4-6. Look for online registration to open soon. Email resources@fi360.com if you are interested in being a speaker and we'll let you know when we have proposal forms available.

Update 4:00 p.m.: Fred Reish just wrapped up his third session here, this time speaking on the changing face of 401(k) plans. He's going over some of the DOL and Treasury measures coming out soon. Says TDFs are no longer special and need to be treated the same as other investments, meaning they should be monitored and replaced, as necessary. 

Reish: "The big question is, 'can we, over forty years, fund a twenty year, full time pre-paid vacation?'"

Update 3:40 p.m.: Chip Hunt's topic is rescuing strategies for defined benefit plans. Going over case studies on how the 2008 credit crisis left most DB plans significantly underfunded and how advisors can structure an investment strategy to help preserve them for their participants.

Update 3:20 p.m.: Greg Porteous discussing ETFs at his session. Discussing how increased focus by the media, lawmakers and regulators on fee transparency make ETFs a good solution for 401(k) plans, especially for small businesses who value low cost.

Update 3:10 p.m.: The last breakout of the 2010 fi360 Conference is underway. David Witz is on stage talking about being a qualified advisor. He says it is harder to become an expert than to be one and that it's near impossible to be an expert in all areas of retirement planning, so most will focus on specific areas and gain the experience to become fully proficient in one area. Takes ten years to become an expert.

Click the link below to read all previous updates from today.

Live blog from day one of the 2010 fi360 Conference

The 2010 fi360 Conference is now underway. After opening remarks from fi360 executives and friends and partners of fi360, former Secretary of Treasury Paul O'Neill began his presentation on government spending and personal accountability. We'll be doing live blogging throughout the day. During the sessions, we'll post some of the best comments as a continuation of this post. If you are on Twitter, you also can follow the action from us @Fiduciary360 as well as other live attendees. Search for the hashtag #fi360_2010 to get the latest updates.

Update 5:15: Day one is in the books. Geoff Davey just wrapped up his session on risk tolerance, saying, "Assessing client risk includes tolerance, capacity, and need." Sunny Loveland gave his presentation on the CFP Board Code of Ethics and acting like a fiduciary. There is a networking reception tonight, with one more full day of sessions tomorrow. We'll be live blogging again, so check in throughout the day.

Investment Advisor magazine has a nice write up on this morning's session with Paul O'Neill.

Update 4:45 p.m.: Brian Graff giving an update on the latest DC developments affecting advisors, including disclosure, advice regs, reform bill and more. Says it is important not to stifle qualified advisors.

Update 4:35 p.m.: Last breakout sessions of day one just started. Brian Graff, Josh Itzoe, Geoff Davey, and Sunny Loveland all speaking.

Josh's presentation is on pre-allocated portfolios. Says consideration of your firm's structure, services, fiduciary status, investment strategy, communications all have weight in deciding to build models.

Click the link below to read all previous updates from today.

Fiduciary Links: 2010 fi360 Conference

Today, early bird registration opened for our 2010 Conference, which is being held May 5-7 in Orlando. It will be our sixth annual conference featuring many of the leading minds in the industry on fiduciary-related topics. It is a valuable event with great content for both fiduciary novices and those who are experienced in fiduciary responsibility alike. You can visit our conference page for more information about this year's and past conferences. We have not yet announced an agenda, but past speakers include Fred Reish, Bob Veres, Lou Harvey of Dalbar, Brian Hamburger, Josh Itzoe of Fixing the 401(k), Matt Hutcheson, Roger Gibson, Susan Mangiero of Pension Risk Matters, and Carl Richards of Behavior Gap, just to name a few. 

The event is exhibitor and sponsor free, and, in addition to the first-rate speakers, has one of the highest caliber of attendees you'll find at an investment industry event. Many of the attendees have been to multiple, if not all, of our past conferences and are at the forefront of incorporating fiduciary processes in to their practices. We encourage you to check us out and feel free to send emails to conference@fi360.com if you have any questions. Early bird prices are only good through November, so register soon!

Now on to the best links of the past week:

In the news/commentary:

• TD Ameritrade and Schwab may be teaming up their advocacy efforts.
• Eight things to keep RIAs from answering to SIFMA
• How SRI can go hand-in-hand with fiduciary principles
• Life planning and the three questions to ask an investor preparing for retirement
• SEC and CFTC propose fiduciary standard for commodities advisors

From the organizations/associations/government/academia:

• The IAA says it supports self-funding of the SEC
• The new Reish Adviser Report looks at benchmarking, 12b-1 fees, legal updates and more.

From the blogs:

• Kate McBride looks at the "authentic" vs. "federal" versions of the fiduciary standard
• Introducing the Fiduciary News blog

Have a link we missed? Leave them in the comments section or email us at blog@fi360.com. For more of the best links during the week, make sure you follow us on Twitter.
 

Conference Wrap-up

First off, thanks to everyone for helping make the 2009 fi360 National Conference an overwhelming success.  The conference committee and staff all contributed greatly with many hours of work and planning.  The speakers, attendees and facilities also were all excellent. 

It is evident that the conference is an energizing event that inspires everyone involved to do more to propel the industry towards a fiduciary society where "everyone looks out for each other," as general session speaker Bob Veres put it. One Twitterer (Carl Richards of Behavior Gap: @behaviorgap if you're on Twitter) from the conference said of our event "Some really, really, smart people here. Talk about a secret society of real financial planners! More people have to know this." and "The fi360 conference was the best I've been to! Very impressed!" It is comments like this that let us know we're gathering a special group. 

The major themes of the conference were the lessons learned from the economic crisis of the past six months or so and the unique opportunity that exists today to help create that fiduciary society. Market turmoil, investor distrust of the industry, and increased focus from professionals, investors, regulators, legislators and the media have made major changes imminent and the question left is if the changes will be done right and for the benefit of investors.  The first and best thing the professionals can do to affect positive change is to apply the highest standard of care to their investment processes regardless of what minimum standards they are actually held accountable to and to act as advocates to whatever extent is available and possible for them. 

If you are interested in learning more about the conference, most materials and handouts are available from our conference portal and recordings of the sessions should be available towards the end of the month.

Finally, here is what others are saying about the conference, we'll update this list as more becomes available.  And, if you are on Twitter, make sure you check out the #fi360_09 hash tag to review the Tweets and Re-Tweets from conference attendees and speakers and their followers.  Also make sure you add us, @Fiduciary360, as a follower.

• From Twitter: @marionasnes, @behaviorgap, @grgay74, @actiumbemanaged, @mlimbacher
• Conference speaker Josh Itzoe from the Fixingthe401k Blog

fi360 Conference and our one-year anniversary!

Hello from the fi360 Conference.  We kicked off this morning with opening remarks from Blaine, a general session from Fred Reish and the first round of breakout sessions.  This is our fifth annual conference and hopefully our best yet.  In addition to the conference activities, we also held an AIF Capstone program and an fi360 Toolkits Workshop in the previous few days here in Scottsdale. This picture is of our Tools Product Manager Dave Palascak doing some one-on-one interaction from the workshop:

 

Blaine's opening remarks were about the great opportunity we currently have to see a robust, ERISA-level fiduciary standard applied universally for all investment advice. The real danger is a watering-down effect as fiduciary levels of care are applied to the commercial standard and the two standards are "harmonized."  He then called on the conference attendees to work as advocates where they can, through public and private speaking, involvement in professional associations, and always providing their services to the highest level care.

We'll post updates as the conference goes on and we're also live-Twittering, so make sure you follow us on Twitter, and note the Twitter feed to the right of this posting.  We also have some attendees sending in their live Tweets, so make sure you check out BehaviorGap, Actium, and George Gay.  If you are here in Scottsdale and Tweeting, make sure to use the #fi360_09 hash tag so that we can find your updates and plug your Twitter account.

Finally, we'd like to point out that this is our one-year anniversary! It was day one of last year's conference that we publicly launched the blog.  We hope that we've gotten better at it over the last year and thank everyone for helping our readership consistently increase over that time.  We're also looking forward to our new hire Kristina Fausti (see our last post) getting into the swing of things as we expect her to be a valuable blogger for fi360.