From: Paige Pierce [mailto:paigep@rwsbroker.com] 

Sent: Wednesday, July 08, 2015 6:04 PM

To: EBSA, E-ORI - EBSA

Cc: paigep@rwsbroker.com; Eichler, Tracy (TEichler@sifma.org); Maurello, John (jmaurello@sifma.org)

Subject: DOL Fiduciary Rule Proposal - RIN 1210-AB32

COMMENT LETTER ON RIN 1210-AB32, DOL FIDUCIARY RULE PROPOSAL 

In my over 30 years in the investment industry I have worked with financial advisors, on the front 

lines and behind the scenes, as we have worked together to help people overcome financial 

uncertainty. Often one of the most important parts of the job is to help clients have the 

confidence they need to achieve their financial goals. It is no surprise then that after years of 

working closely with clients, close trusting relationships are formed.

A new "conflict of interest" retirement regulation from the Department of Labor (DOL) seems to 

suggest something else about financial advisors, that professionals are willing to put their own 

financial interests above the clients. In my experience, that could not be further from the truth.

The DOL does get one thing right and that is financial advice should be in the best interest of 

the customer. I do not have a single colleague who would disagree with the statement, and we 

all support a regulatory framework that improves outcomes for savers. However, the rule 

proposal, as written, does not achieve that and in fact will hurt the customers it intends to help. 

An all-too-common result in Washington these days.

Currently, savers planning for retirement can choose between fee-based investment advisory 

services or commission-based financial advice. While fee-based accounts afford the highest 

level of attention, commission-based services offer the best balance of advice and 

AFFORDABILITY. That is why 98% of IRA accounts below $25,000 are in commission-based 

brokerage relationships, and appropriately so.

The DOL's current proposal virtually eliminates the commission-based option, which is not in the 

best interest of retirement savers. The rule's new requirements and restrictions on commissionbased offerings are so cumbersome and so complex, such as forecasting projected returns and 

costs of financial products 10 years in the future (what?!), that it no longer becomes practical to 

offer them, especially for small firms.

The consequences of this piece of poorly written regulation will be devastating. In order for 

clients to have access to the same level of advice and service they were accustomed to with 

their commission-based account relationships, they will be forced into expensive accounts and 

have to pay for additional services they do not want or need, or even worse, will be left with no 

advice at all. Without guidance from a professional, the prospect of meeting their retirement 

goals becomes much more daunting and less likely.

Equally problematic, the DOL's rule only applies to retirement accounts. Routinely all types of 

investing options and paths forward are discussed with a client. The DOL has created a 

scenario where advisors can offer guidance on a retail securities account, but as soon as the 

conversation moves to the client's IRA an entirely different set of complex rules suddenly 

applies, prohibiting us from having the types of conversations clients have had with their 

advisors for years. This is a real problem for investors and savers alike, many of whom are one 

in the same.
The DOL's impetus for this proposed regulation stems from the fact that investors/savers 

regularly state in surveys that they are confused about the difference between fee-based 

accounts and commission-based accounts. Additionally, there is an inaccurate accusation from 

the DOL that financial advisors regularly put their own financial interests above their clients. In 

regard to the former, that is an easy problem to address through continued investor outreach 

and education - and is most certainly not resolved by essentially eliminating investor choice and 

increasing cost to retail customers. To the latter point, after over 30 years in the industry it is my 

firmly held belief based on decades of experience, that accusation is unfair, unfounded and 

reckless. The vast majority of professionals in the investment industry embody the very best in 

business: knowledge & expertise, integrity & honor, dedication & loyalty to their clients - and 

don't let anyone tell you any different.

Financial advice (and, for that matter, financial regulation) should be in the best interest of 

savers and I support rules that contribute toward that goal. The DOL, however, has gone 

beyond clients' bet interests in a way that constrains investor choice, raises costs, 

disadvantages small firms and puts clients' financial well-being at risk. I strongly encourage 

policymakers to carefully consider these consequences and withdraw the proposed regulation 

so that Americans saving for their retirement will not be adversely affected for decades to come.

Thank you for your consideration of these comments.

PAIGE W. PIERCE

RW SMITH & ASSOCIATES, LLC

The Power of Wall Street. The Promise of Main Street. TM

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