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THRIVENT enter VicePresgent
FINANCIAL® General Counsel and Secretary

General Counsel's Office

Connecting faith & finances for good. ate
, . i Minneapolis, MN 55415-1665
Via http://www.regulations.gov Moeasias

April 28, 2015 800-847-4836 "Directory" ext. 5183
Fax: 612-844-4285

7 . le a.rasmussen@thrivent.com
Employee Benefits Security Administration eres 0 “ven

U.S. Department of Labor
200 Constitution Avenue, NW
Washington, DC 20201

Re: Comment Period for Conflict of Interest Rule and Related Exemptions
To Whom It May Concern:

We are writing to request a 45-day extension of the comment period for the U.S. Department of Labor’s
(the “Department”) proposals regarding the (1) Definition of the Term “Fiduciary”; Conflict of Interest
Rule—Retirement Investment Advice,’ (2) Best Interest Contract Exemption,’ (3) Principal Transaction
Exemption,’ and (4) related amendments to four existing prohibited transaction exemptions*
(collectively, the “Proposal”}.

As a fraternal benefit society organized under section 501(c)(8) of the Internal Revenue Code,’ Thrivent
Financial is a not-for-profit, membership organization of Christians. We offer a broad range of financial

* Dep't of Labor, Employee Benefits Sec. Admin., Definition of Term “Fiduciary”; Conflict of Interest Rule—
Retirement Investment Advice, 80 Fed. Reg. 21,928 (Apr. 20, 2015) {the “Re-Proposing Release”), available at
http://www.gpo.gov/fdsys/pkg/FR-2015-04-20/pdf/2015-08831.pdf.

Dep't of Labor, Employee Benefits Sec. Admin., Proposed Best Interest Contract Exemption, Application No. D-
11712, 80 Fed. Reg. 21,960 (Apr. 20, 2015), available at http://www.gpo.gov/fdsys/pkg/FR-2015-04-20/pdf/2015-
08832.pdf.

3 Dep’t of Labor, Employee Benefits Sec. Admin., Proposed Class Exemption for Principal Transactions in Certain
Debt Securities between Investment Advice Fiduciaries and Employee Benefit Plans and IRAs, Application No. D-
11713, 80 Fed. Reg. 21989 (Apr. 20, 2015), available at http://www.gpo.gov/fdsys/pkg/FR-2015-04-20/pdf/2015-
08833.pdf.

4 Dep't of Labor, Employee Benefits Sec. Admin., Proposed Amendment to Prohibited Transaction Exemption (PTE)
75-1, Part V, Exemptions from Prohibitions Respecting Certain Classes of Transactions Involving Employee Benefit
Plans and Broker-Dealers; Prohibitions Respecting Certain Classes of Transactions Involving Employee Benefits
Plans and Certain Broker-Dealers, Reporting Dealers and Banks, Application No. D-11687, 80 Fed. Reg. 22,004 (Apr.
20, 2015), available at http://www.gpo.gov/fdsys/pkg/FR-2015-04-20/pdf/2015-08836.pdf; Dep’t of Labor,
Employee Benefits Sec. Admin., Proposed Amendment to and Proposed Partial Revocation of Prohibited
Transaction Exemption (PTE) 84-24 for Certain Transactions Involving Insurance Agents and Brokers, Pension
Consultants, Insurance Companies and Investment Company Principal Underwriters, Application No. D-11850, 80
Fed. Reg. 22,010 (Apr. 20, 2015), available at http://www.gpo.gov/fdsys/pkg/FR-2015-04-20/pdf/2015-08837.pdf;
Dep’t of Labor, Employee Benefits Sec. Admin., Proposed Amendment to and Proposed Partial Revocation of
Prohibited Transaction Exemption (PTE) 86-128 for Securities Transactions Involving Employee Benefit Plans and
Broker-Dealers; Proposed Amendment to and Proposed Partial Revocation of PTE 75-1, Exemptions From
Prohibitions Respecting Certain Classes of Transactions Involving Employee Benefit Plans and Certain Broker-
Dealers, Reporting Dealers and Banks, Application No. D-11327, 80 Fed. Reg. 22,021 (Apr. 20, 2015), available at
http://www.gpo.gov/fdsys/pkg/FR-2015-04-20/pdf/2015-08838.pdf; and Employee Benefits Sec. Admin., Proposed
Amendments to Class Exemptions75-1, 77-4, 80-83 and 83-1, Application No. 0-11820, 80 Fed. Reg. 22035 (Apr.
20, 2015), available at http://www.gpo.gov/fdsys/pkg/FR-2015-04-20/pdf/2015-08839.pdf.

FLR.C. § 501(cH8)

800-THRIVENT (800-847-4836) * Thrivent.com


products and services, including life insurance, annuities disability insurance and long term care
Coverage. We also distribute proprietary mutual funds through a subsidiary. These products are offered
to our membership through the tailored guidance of our financial representatives nationwide. For more
than a century, we've helped our 2.4 million member-owners nationwide be wise with money and live
generously. We have more than 2,300 licensed financial representatives in all 50 states; manage more
than $105 billion in assets under management, and have approximately $182.5 billion of individual life
insurance in force. As a fraternal benefit society, we also carry out a mission of charitable, educational
and other fraternal purposes in service to communities nationwide.

The impact of the proposed rule will be felt by our members we serve with advice regarding IRAs, largely
people of modest means. Of those members, 54% have an annual household income of less than
$75,000 and 50% have less than $25,000 in their IRA. We presently have 467,062 members who have
IRAs with us,

As the Department is aware, the Proposal comprises a voluminous amount of information and, if
adopted, would represent a watershed event touching many aspects of Thrivent operations. The
Proposal contains detailed new rules, a new exemption that will subject IRA advisers to increased legal
risk for violations of strict prudence requirements, and a host of detailed changes to existing and widely-
used exemptions. Our regulatory compliance staff will require time to assess our ability to revise our
internal policies to comply with the conditions of the exemptions—which are fundamental to the ability
of our financial representatives to continue to provide essential services to our members, but which will
require significant changes in policies and practices, as well as new disclosure mechanisms.

We appreciate that, in response to comments received following the release of the predecessor
proposal in October 2010 (the “2010 Predecessor Proposal”),° the Department has spent considerable
time and effort to incorporate into the Proposal an avenue for advisers and financial institutions to
continue to provide services to retirement investors and receive compensation through commission-
based arrangements. Consistent with the Department's request, Thrivent and our regulatory compliance
staff are committed to taking a thoughtful and well-informed approach to commenting on the Proposal.
To do so, we will need sufficient time to carefully analyze and understand the practical implications of
the Proposal.

Given the Proposal’s breadth and the far reaching modifications that will be required to meet the
conditions to the exemptive relief that the Department perceives as important for the protection of the
interests of retirement investors, the 75-day comment period does not provide adequate time for our
staff to determine whether we can continue to effectively service the needs of our members within the
framework presented in the Proposal.

Our concerns with the 75-day comment period are supported by the history of the Proposal. The 2010
Predecessor Proposal (1) was shorter and less complicated than the Proposal; (2) did not include any
exemptions, as opposed to the Proposal, which has two new exemptions and amendments to four
existing exemptions; and (3) contained an economic analysis that was a fraction as long as the economic

© Dep’t of Labor, Employee Benefits Sec. Admin., Definition of the Term “Fiduciary,” 75 Fed. Reg. 65,263 (Oct. 22,
2010) (the “Proposing Release”), available at
http://webapps.dol.gov/FederalRegister/PdfDisplay.aspx?Docld=24328.


analysis regarding the Proposal.’ Yet not only did the Department provide a 90-day comment period
with respect to the 2010 Predecessor Proposal, but the Department also recognized that 90 days was
insufficient, later adding two additional weeks to the comment period. in connection with the extension,
the Department stated:

“We recognize the significance of the proposed rule for plans, participants, beneficiaries and
many plan service providers and therefore believe the steps we are announcing today will
ensure broad consideration of all the issues and interests in this regulation.”®

We applauded the Department's decision to establish a 104-day comment period with respect to the
2010 Predecessor Proposal, and to have a hearing and a post-hearing comment period in 2011. In that
context, Thrivent remains very concerned about the much shorter 75-day period provided with respect
to a much longer and more complicated Proposal.

For these reasons, we are joining others in requesting a 45-day extension of the comment period. We
believe that a 120-day comment period would lead to more thoughtful and comprehensive input,
which will ultimately increase the possibility for a more workable final rule that would benefit all
parties.

Respectfully submitted,
Serer Yiamumser
Teresa Rasmussen, Senior Vice President, Secretary and General Counsel

Ce: Mr. Fred Wong,
Office of Regulations of Interpretations
Employee Benefits Security Administration
U.S. Department of Labor

Ms. Karen Lloyd

Office of Exemption Determinations
Employee Benefits Security Administration
U.S. Department of Labor

Mr. G. Christopher Cosby

Office of Policy and Research

Employee Benefits Security Administration
U.S. Department of Labor

The Honorable Howard Shelanski, Administrator
Office of Information and Regulatory Affairs
Office of Management and Budget

7 while we appreciate the significantly more extensive economic analysis of the Proposal compared with the
insufficient analysis of the 2010 Predecessor Proposal, the Proposal’s economic analysis will require extensive time
and resources for review and analysis.

“ EBSA NEWS (Dec. 22, 2010).