Lawmakers Aim to Reform Index Linked Annuities Registration Regs
A bipartisan group of representatives is seeking to require the Securities and Exchange Commission to revise its rules regarding the development and offering of certain annuity products.
A trio of lawmakers has reintroduced the Registration for Index Linked Annuities Act, a piece of legislation that supporters say will lower barriers to the launch of innovative retirement income products.
The legislation would require the U.S. Securities and Exchange Commission (SEC) to revise its rules regarding the development and offering of certain annuity products. Specifically, the bill directs the SEC to devise a new form for annuity issuers to use when filing registered index-linked annuities (RILAs).
Under current SEC rules, these and other new products must be registered using forms designed primarily for equity offerings. Therefore, supporters of the Registration for Index Linked Annuities Act say, registration of these products requires the provision of extensive information that is in fact not relevant to prospective annuity purchasers. They say these forms also require disclosure of financial information prepared in accordance with generally accepted accounting principles (GAAP), which many insurers are not otherwise required to produce.
Cosponsors of the legislation include Representative Alma Adams, D-North Carolina; Representative Dean Phillips, D-Minnesota; and Representative Anthony Gonzalez, R-Ohio. The lawmakers say the legislation will address the misalignment between the current registration forms used for RILAs and the information needed by investors who might benefit from purchasing these products—a point of view shared by the Insured Retirement Institute (IRI).
“The current rules and processes to register RILAs stymies innovation, creates a barrier to entry into this growing market for insurers that do not produce GAAP financials, and impedes consumer comprehension and choice with excessive and confusing information,” says Wayne Chopus, IRI President and CEO. “A new registration form more closely tailored to the particular products being offered would ensure that consumers have access to the pertinent information they need to make an informed investment decision.”
Experts say a registered index-linked annuity, used correctly, can bring balance to retirement portfolios by allowing participation in market growth while reducing exposure to market loss, helping savers reach retirement goals.
“This regulatory structure ultimately impairs consumer choice without any corresponding benefit to consumers or the SEC,” Chopus argues. “The modernized approach contemplated by this legislation will encourage innovation and ensure investors can easily find the information they need about RILAs and other innovative products without having to wade through irrelevant, excessive, and confusing disclosure documents.”
The text of the latest version of the bill is not yet available online, but a previous version can be viewed here.
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T. Rowe Price expands sales and consultant relations team; HUB hires retirement and private wealth CIO; WFAM to be rebranded as Allspring Global Investments; and more.
T. Rowe Price Expands DC Sales and Consultant Relations Team
T. Rowe Price Retirement Plan Services, Inc. hired Joe Culhane and Ian Holstrom to expand its large market defined contribution (DC) sales and consultant relations team.
Culhane joins the firm as a senior retirement sales executive and will initially cover the mega plan market in the western United States.
“Joe brings an abundance of experience in the retirement plan industry, having successfully served plan sponsor clients and their financial professionals for more than three decades. We look forward to the contributions he will make to our organization,” says Lee Stevens, head of Institutional Sales & Consultant Relations at T. Rowe Price Retirement Plan Services, Inc.
Culhane will be working out of the firm’s San Francisco office when he is not meeting with plan sponsors and advisers.
Holstromjoins the consultant relations team and will be covering several key adviser relationships. He returns to T. Rowe Price from an advisory firm, where he worked in business development and retirement plan consulting.
“Ian brings nearly decade of retirement plan experience to T. Rowe Price, having previously served both at our firm and another. We’re happy to welcome him back to T. Rowe Price and benefit from his client service experience and collaboration,” says Christine Carolan, director of Consultant Relations.
HUB Hires Retirement and Private Wealth CIO
Brian Collins has joined HUB International as chief investment officer (CIO) of HUB Retirement and Private Wealth (HUB RPW).
“The addition of Brian to our team underscores our commitment to developing investment strategies that best enable advisers to serve the needs of their plan sponsors and the millions of employees saving for a successful retirement,” says Joe DeNoyior, national president of HUB RPW.
Collins will be responsible for HUB RPW’s investment platforms focusing on building strategic advisory solutions and offerings that continue HUB RPW’s growth. He will lead the HUB RPW Investment team to expand and scale up its capabilities and offerings nationally to best serve clients’ current and future needs.
Collins was most recently with Harbor Capital Advisors as executive vice president and CIO, responsible for building its institutional investment platform that supported a multi-billion-dollar asset management business. He is a chartered financial analyst (CFA) and earned his master’s in business administration in finance and management strategy from Northwestern University’s Kellogg Graduate School of Management and his bachelor of science degree in business administration in finance from Georgetown University.
WFAM to be Rebranded as Allspring Global Investments
GTCR LLC and Reverence Capital Partners, L.P. announced that upon closing of their acquisition of Wells Fargo Asset Management (WFAM), the newly independent company will be rebranded as Allspring Global Investments.
As part of the transition, veteran industry executive Joseph A. Sullivan will become chief executive officer, in addition to his previously announced role as executive chairman. Sullivan will succeed Nico Marais, WFAM’s current CEO, who will retire upon closing of the transaction and continue to serve Allspring as a senior adviser.
Sullivan comes to Allspring with more than 40 years of industry experience, previously serving as chairman and chief executive officer (CEO) of Legg Mason, Inc. from 2012 until its acquisition by Franklin Templeton in 2020. He joined Legg Mason in September 2008 and, after serving as head of global distribution and chief administrative officer, was appointed interim chief executive officer as of October 2012. Before joining Legg Mason, he served on the board of directors of Stifel Financial and as executive vice president and head of fixed income capital markets for Stifel Nicolaus from December 2005.
Milton Berlinski, co-founder and managing partner of Reverence Capital, says, “Today’s leadership and name announcements give us even stronger conviction that the partnership between WFAM, GTCR and Reverence puts us in a powerful position to execute on our strategic vision for Allspring. We are pleased to have a leader of Joe’s stature to take us forward as a newly independent company, and we are very grateful to Nico for his strong continued partnership during this time.”
The name change to Allspring Global Investments is expected to go into effect upon the closing date of the transaction, which is anticipated to occur in the second half of 2021, subject to customary closing conditions. Additional details related to the new independent company and its brand identity will be shared upon closing of the transaction.
IPS Acquires CPA Firm’s Pension Services Group
Integrated Pension Services (IPS), the retirement and pension services arm of Integrated Partners, has acquired Benefits 21, Friedman LLP’s Pension Administration Services Group. Friedman LLP is one of the largest certified public accountant (CPA) firms.
“With the addition of Benefits 21, we are able to further scale our pension administration business and bring our services to clients in a wider geographic footprint,” says Will Hackler, IPS’ director of Retirement Services.
Friedman has been providing accounting, tax and business consulting services to private and public companies since 1924. Headquartered in Manhattan, Friedman has locations on the east and west coast of the United States, as well as in China.
“Our decision to form a strategic alliance with Integrated Pension Services was based on their depth of knowledge in the industry and the superior level of support they give clients,” says Harriet Greenberg, CPA, PFS, co-managing partner of Friedman.
Morgan Stanley at Work and Vestwell Announce Partnership
Morgan Stanley at Work announced a retirement partnership with Vestwellthat it says delivers user-friendly digital solutions and favored pricing.
“We continuously look for new and exciting ways to raise the bar on what both clients and participants can expect when it comes to an employee’s financial journey,” says Brian McDonald, co-head of Morgan Stanley at Work. “Our partnership with Vestwell represents a major step forward for the industry, where clients benefit from groundbreaking digital technology and exceptional service delivered at the competitive price points that Morgan Stanley’s scale can deliver. This is truly a win-win for the marketplace, creating a value proposition that is hard to beat.”
In addition to the commercial business relationship with Vestwell, Morgan Stanley also made a strategic investment in the firm during Vestwell’s recent Series C financing round.
“Morgan Stanley’s commitment to be a change agent that revolutionizes workplace savings programs for employers and employees aligns perfectly with our vision at Vestwell,” says Aaron Schumm, Founder and CEO of Vestwell. “Together, we are fundamentally altering the way technology and servicing can elevate and scale the experience. We are so grateful and excited to partner with the Morgan Stanley team and their thousands of financial advisers to drive change for the better.”
Morgan Stanley at Work Retirement Solutions offers a multi-provider recordkeeper platform designed to meet the individual needs of companies. In addition to providing customized retirement solutions, Morgan Stanley has dedicated retirement specialists that offer support and service for client’s employees. Through a consultative process, the firm’s specialists help companies improve plan competitiveness and fiduciary risk management, investment selection and monitoring, and employee retirement readiness.
FPS Group Rebrands as IPX Retirement
Retirement plan services provider FPS Group is changing its name to IPX Retirement, effective immediately.
The rebrand reflects the name of FPS Group’s flagship recordkeeping platform, Investment Provider Xchange (IPX), and the company’s renewed focus on investor outcomes. The rebranding initiative features a new customer-focused website—ipxretirement.com—along with logo and product enhancements.
“We are committed to improving results for investors and the advisers that serve them at every stage of retirement planning, from asset accumulation to lifetime income,” says Bill Mueller, CEO.
The firm says the IPX recordkeeping platform is the industry’s only one for non-profit plans that consolidates multiple investment providers on a single platform and allows access to mutual funds, exchange-traded funds (ETFs), fixed income annuities and professionally managed portfolios.
IPX Retirement specializes in recordkeeping solutions for non-profit organizations like schools, higher ed and faith-based institutions, municipalities and other non-profit organizations that manage 403(b), 457, FICA [Federal Insurance Contributions Act] Alternative or similar retirement plans for their employees.
IPX Retirement is also a provider of force-out individual retirement account (IRA) solutions for all types of retirement plans. The IPX Safe Harbor IRA program for employers is an automated solution to manage fiduciary risks from missing participants, small accounts or uncashed checks.
IPX Trust, the trust division of IPX Retirement, manages the IPX Safe Harbor IRA program and offers paying agent, trust and custody solutions to support retirement and health savings plans. Formerly known as FPS Trust, IPX Trust is a nondepository trust company chartered in Colorado.
Hall Benefits Law Selects New Partner
Hall Benefits Law (HBL) has added Partner Tim Kennedy.
Kennedy will be headquartered in the Firm’s Philadelphia office, serving plan sponsors and service providers nationwide.
He brings more than 20 years of large law firm experience counseling employers and plan sponsors on the design, implementation, and compliance of a wide variety of ERISA [Employee Retirement Income Security Act] tax-qualified plans and executive compensation arrangements. This includes health and welfare plans (e.g., group health, cafeteria and flexible spending account plans), pension and savings plans (e.g., 401(k), profit-sharing, traditional defined benefit and cash-balance plans), and non-qualified deferred compensation (NQDC) plans.
Kennedy also spent over five years working as in-house counsel for a large, global investment bank, where his practice focused on the fiduciary responsibility, prohibited transaction and funding rules of ERISA, specifically how they relate to financial products and services, U.S. Federal income tax, securities, and other financially related legal matters concerning compensation and benefits.