MUTUAL OF AMERICA 

LIFE INSURANCE COMPANY

320 PARK AVENUE 

NEW YORK NY 10022-6839

212 224 1566

NICHOLAS S. CURABBA

SENIOR VICE PRESIDENT & ASSOCIATE GENERAL 

COUNSEL

July 21, 2015

Mailed Electronically

Office of Regulations and Interpretations 

Employee Benefits Security Administration 

Attn: Conflict of Interest Rule, Room N-5655 

U.S. Department of Labor 

200 Constitution Avenue, NW 

Washington, DC 20210 

Subject: Definition of the Term “Fiduciary”; Conflict of Interest Rule—Retirement 

Investment Advice (RIN 1210-AB32)

Mutual of America Life Insurance Company ( “Mutual of America”) is pleased to provide its

comments on the proposed regulation promulgated under Sections 3(21)(A)(ii) the Employee 

Retirement Income Security Act of 1974, as amended (“ERISA”) (collectively, the “Proposed 

Regulation”). Mutual of America participated in the drafting and fully endorses the comment 

letter submitted by the American Council of Life Insurers, and this comment letter should not be 

read to be inconsistent with or contrary to the significant concerns detailed therein. Mutual of 

America writes separately to register an additional concern which we believe the Department of 

Labor (the “Department”) must address before proceeding to a final regulation. 

Mutual of America Life Insurance Company is a mutual life insurance company organized 

under the New York Insurance Law. The Company is licensed and authorized to transact 

business in all fifty states and the District of Columbia. As a mutual company, it is organized, 

maintained and operated for the benefit of its policyowners. It is subject to regulation by the 

New York State Department of Financial Services as well as the insurance regulatory authorities 

of the the 49 other states and the District of Columbia. 

The majority of Mutual of America’s in-force business and new sales consists of annuity 

contracts, primarily group variable accumulation annuity contracts to fund tax qualified defined 

contribution retirement savings plans such as 401(k) pension plans and 403(b) thrift pension 

plans that seek to provide small-to-medium size employers and their employees with 

standardized features and a high degree of flexibility in managing their retirement savings. In 

addition, the Company makes available group and individual life insurance and group long-term 

disability income insurance.
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For individuals, the Company also offers individual retirement annuities (“IRA”) and 

nonqualified flexible premium annuities (“FPA”). The IRA is a variable accumulation annuity 

contract that is made available to individuals where contributions are eligible for tax 

deductibility, where only earnings are tax deferred and to individuals who are eligible to roll over 

amounts from their employer’s pension plan due to an in service distribution; upon retirement; 

termination of employment; or as a distribution of an eligible death benefit. The FPA is a

nonqualified individual variable accumulation annuity contract for long range savings, generally 

not associated with any tax-qualified pension plan or other retirement savings arrangement. The 

FPA contains similar features as the Company’s individual IRA annuity contract, except that 

there is no tax deductibility on amounts contributed to the contract, but there is tax deferral on 

any appreciation of funds accumulated under the annuity contract until withdrawal.

Importantly, the Company’s group and individual variable accumulation annuity contracts, 

do not have “front-end” charges on premiums, contributions or transfers, or “back-end” charges 

or surrender penalties on withdrawals, or market value reductions. In addition, the Company’s 

variable accumulation contracts do not have secondary guarantee elements, market value 

adjustment features, equity index features, bonuses, persistency enhancements, a-typical 

conversion or renewal options, bailout features, premium refund features, additional insurance 

options, a-typical liquidity features, products or riders often packaged with a given product, atypical settlement options, commutation options or optional benefits. During the accumulation 

phase, the Company’s variable accumulation annuity contracts generally permit transfers to and 

from the fixed interest accumulation of the Company’s general account and the investment funds 

of the separate accounts or among the investment funds of the separate accounts, without charge 

or restriction, subject to compliance with the Company’s and the investment company funds’ 

frequent transfer policies that are consistent with SEC Rule 22c-2. There are no tax 

consequences for any transfers.

In addition to regulation under state insurance laws, the Company’s variable annuity products 

are subject to registration as securities under federal securities law and, as a result, Mutual of 

America is registered as a broker/dealer with the Securities and Exchange Commission (SEC) 

and is a member of FINRA, a securities industry self-regulatory organization, in order to 

facilitate the distribution of its variable accumulation annuity contracts and individual variable 

universal life insurance.

Assets contributed to the Company’s group and individual variable contracts may be 

allocated to the Company’s General Account or to the one of the Company’s three Separate 

Accounts. Two of Mutual of America’s separate accounts, Separate Accounts No. 2 and No. 3, 

are registered with the SEC as unit investment trusts, because the variable annuity and variable 

life insurance contracts for these separate accounts are not exempt from registration under the 

federal securities laws. Separate Account No. 1 is available for group annuity contracts that fund 

tax-qualified pension plans and is exempt from registration under the securities laws, but is also 

structured as a unit investment trust. The Separate Accounts invest solely in the shares of funds 

of ten designated investment companies, including shares of the Mutual of America Investment 
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Corporation, which are only distributed to the Mutual of America Separate Accounts and the 

Separate Accounts of a former subsidiary that are administered by Mutual of America. The 

menu of mutual funds offered under the Mutual of America contracts is the same for all contract 

holders and plan participants. The Company offers a total of 38 investment alternatives, 

excluding the General Account, which the Company believes are suitable and appropriate for 

retirement savings. Twenty-four of the funds, including 10 funds in a target date retirement 

series, are proprietary funds offered by Mutual of America Investment Company. The 14 other 

funds offered are from nine other investment companies. 

Mutual of America distributes its group and individual products nationally directly through 

salaried sales representatives employed by the Company and located in 34 Regional Offices. 

The sales representatives are not permitted to sell any products offered by other insurers. The 

Company does not distribute products through independent brokers, agents, financial planners or 

registered investment advisers and does not pay commissions. All sales representatives are paid 

an annual salary based upon their assigned responsibilities and experience and, like all Company 

employees, are eligible for an annual incentive compensation award, which will vary based upon 

certain performance factors, including new sales and asset retention. In addition, as employees 

of Mutual of America, our registered representatives can sell only Mutual of America products

and do not offer any other securities or non-securities products. The recommendations our 

employees make to customers are, therefore, purely incidental to the sale of the product and are 

representations of the benefits and value of the product. Mutual of America’s sales 

representatives do not make recommendations to its customers regarding allocation of their 

assets amongthe Separate Account investment funds or the General Account.

In the preamble to the Proposed Regulation, the Department recognizes the importance of 

preserving the non-fiduciary treatment of sales activity that are part of arm's length transactions 

where neither side can reasonably assume the seller is acting as an impartial trusted adviser. We 

are concerned that, despite the intentions expressed by the Department in the preamble to the 

Proposed Regulation, the operative language of the “counter-party carve-out” is not sufficiently 

broad enough to encompass all sales activity in situations where no reasonable person would 

expect that the salesperson is providing impartial advice. 

In particular, in situations where the individual salesperson is a salaried employee of a 

financial institution and is authorized to sell only the products of such institution, sales activity of 

such employee should not be considered fiduciary investment advice when there is no individual 

financial incentive to the salesperson. Such sales activity routinely involves representations and 

education regarding the value and benefits of the offered products. Such representations are not, 

however, offered as impartial investment advice. As with the transactions contemplated by the 

counterparty carve-out, the retirement investor in such situations understands that he or she is 

purchasing an investment product, not advice regarding how the product compares to the 

universe of available non-proprietary investments. The advice received is, in fact, incidental 

advice due to the person’s status as an employee or agent of the manufacturer of the available 

investments, rather than fiduciary investment advice. Moreover, salaried employees who are 
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authorized to sell only proprietary products are already in a representational relationship with 

their employer. Imposing on these employees the requirement to engage in a type of dual 

representation would be inconsistent with the obligations and duties they have as employees.

Accordingly, we respectfully request the Department to recognize that salaried, noncommissioned salespeople cannot be presumed to be providing impartial investment advice, and 

cannot be deemed to be investment advice fiduciaries under the proposed rule. 

Further, we also request that the Department provide further clarification with respect to the 

Proposed Regulation’s fiduciary investment advice platform provider carve-out.1 As noted in 

the Preamble to the Proposed Regulation, the Department recognizes the utility of the carve-out 

for platform providers for the “effective and efficient operation of plans.” It is our 

understanding that a “platform or similar mechanism” under this carve-out includes a group 

variable annuity insurance contract. Otherwise, insurance companies such as Mutual of America 

would be severely disadvantaged as compared to other plan service providers. Further, we also 

believe the carve-out covers plan service providers that merely market and make available a 

platform of predefined investment options as selected by the plan sponsor on a take-it or leave-it

basis, provided that the arrangement permits the plan sponsor to terminate such contract on short 

notice without penalty. Similar arrangements have previously been reviewed by the Department 

and have not resulted in the service provider being deemed a fiduciary under ERISA.2 In 

addition to the foregoing clarification, we believe the Department should preserve the platform 

provider carve-out for all plan sizes in the final regulation, regardless of asset size, as 

contemplated in the Proposed Regulation, and should extend the carve-out to sales of IRAs. 

Adequate protection is provided to small plans and IRAs due to the disclosures that are required 

of providers relying on this exception, and excluding small plans and IRAs from the platform 

provider carve-out is likely to disadvantage smaller employers and small investors who may find 

it difficult to obtain the products and service they require if providers are subject to a fiduciary 

standard.

Thank you for the opportunity to comment on the Proposed Regulation. 

Sincerely,

Nicholas S. Curabba

 1 DOL Proposed Regulation § 2510.3–21(b)(3) (2015). 2 See, e.g., 29 C.F.R. 2550.408b-2(c); DOL Advisory Opinion 2003-09A; DOL Advisory Opinion 1997-16A.