Deals & People May 26, 2023

NFP, Nationwide Name New Retirement Leaders

NFP appoints Joel Shapiro as president of retirement division; Nationwide taps Cheryl Thompson for head of retirement solutions operations.

 

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Joel Shapiro

Two retirement industry players named new leaders this month, with insurance broker and consultant NFP elevating Joel Shapiro to president, and insurance and financial services firm Nationwide appointing Cheryl Thompson as head of retirement operations. 

Shapiro’s promotion, announced on May 18, elevates him from senior vice president, ERISA compliance, to president of NFP’s retirement advisory division. Shapiro brings three decades of industry experience, including 13 years in senior leadership roles with NFP’s retirement advisory division.  

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“We are excited for Joel to lead NFP’s Retirement division and drive its next phase of growth,” said Doug Hammond, NFP’s chairman and CEO, in a statement. “His leadership experience across retirement consulting and ERISA legislative and regulatory compliance makes him an excellent choice to lead our Retirement business.” 

Vince Giovinazzo and Nick Della Vedova, former CEO and President of NFP’s Retirement division, respectively, will be leaving NFP, but continuing with their roles heading flexPATH Strategies LLC and Retirement Plan Advisory Group, according to the release. Those firms are focused on technology, investment and service solutions for advisers working with plan sponsors and participants.  

Nationwide 

Cheryl Thompson

In other news announced May 17, Thompson was selected to lead Nationwide Financial’s retirement solutions operations team as vice president.  

In her new role, Thompson will lead retirement plan support services for the company. Thompson succeeds Wendy Shaw, who will lead the Nationwide shared business solutions team, according to the announcement.   

Thompson joined Nationwide in 1989 and has spent 34 years of her career at the firm. Her most recent role was as associate vice president of retirement solutions operations. 

“Cheryl’s passion for the business will help an already high-performing team become even better,” Eric Stevenson, president of Nationwide Retirement Solutions, said in a statement. “She is driven to propel Retirement Solutions to even higher experience levels in how we serve participants, plan sponsors and partners.” 

Compliance May 25, 2023

CITs: Coming Soon to 403(b) Plans?

A bill approved by the House Committee on Financial Services would permit CITs in all 403(b) plans to bring parity with other tax-privileged plans.

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The House Committee on Financial Services voted on Wednesday to advance the Retirement Fairness for Charities and Educational Institutions Act. The bill would amend securities laws such that collective investment trusts will be allowed in 403(b) plans.

The bill, initially proposed by Representative Frank Lucas, R-Oklahoma, passed the committee by a vote of 35-12. Lucas explained that his bill would bring parity between 403(b) and 401(k) plans. Lucas argued 403(b) plans are at an unfair and unjustified disadvantage relative to other plans, because they are not permitted to invest in CITs (which can be cheaper or more flexible to offer than mutual funds), which only serves to discriminate against teachers and charity workers who make disproportionate use of 403(b)s.

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Representative Wiley Nickel, D-North Carolina, a co-sponsor of the bill, said there is “no reason that people teaching our children and caring for our sick should be paying millions more in investment costs than private sector employees.”

Lucas noted that the substance of the bill was present in the House version of the SECURE 2.0 Act of 2022, known then as the Securing a Strong Retirement Act, which was later bundled into the larger legislative package. The House version passed Ways and Means unanimously in 2022, but due to committee jurisdiction, Ways and Means was only able to amend the relevant tax law, not the securities laws, leaving CITs excluded from 403(b)s.

Representative Sylvia Garcia, D-Texas, offered an amendment to Lucas’s bill which was defeated 26-21. The amendment would have opened 403(b)s up to CITs, but only if they are ERISA-governed 403(b)s. She explained that in order to achieve true parity, 403(b) plans should have the same protections that 401(k)s have under ERISA, and allowing unregistered funds into non-ERISA plans would remove “meaningful safeguards.”

Lucas answered that 403(b) plans can offer many of the same investment products as 401(k)s and that non-ERISA 457s are not prohibited from using CITs either. He said debating which plans should be ERISA-governed is a separate debate and should not hinder passage of this bill.

The Investment Company Institute and the Insured Retirement Institute expressed strong support for the bill. The IRI said it would place nonprofit employees on a “level playing field,” and the ICI said it “would expand opportunities for American savers and investors.”

The bill must now pass the full House before advancing to the Senate.

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