July 20th, 2015

U.S. Department of Labor 

Office of Regulations and Interpretations

Employee Benefits Security Administration

200 Constitution Avenue, NW

Washington, DC 20210 

Re: Definition of the Term “Fiduciary”; Conflict of Interest Rule—Retirement Investment Advice 

(RIN 1210-AB32)

Ladies and Gentlemen: 

Thank you for the opportunity to provide comments regarding the Department of Labor’s 

(“Department”) Proposed Conflict of Interest Rule (“Proposed Rule”) and Best Interest Contract 

Exemption (“BIC Exemption”) under the Employee Retirement Income Security Act of 1974, as 

amended (“ERISA”). I am concerned that the Proposed Rule and BIC Exemption will 

unnecessarily increase barriers for Middle-Income Americans to the valuable retirement savings 

education and assistance that I and many thousands of other registered representatives 

provide. It is my hope that my comments are helpful to the Department. 

I have been a registered representative with PFS Investments Inc. since 1986. My office is in 

Wichita, Kansas. My clients come from the community in which I live and work. They are hardworking, very busy people, and, quite typically, before they meet me, no one has ever taken the 

time to sit down with them to assess their financial picture and discuss basic financial concepts 

with them, such as the power of saving for retirement through systematic investing and what 

investment options are available to them. They, like so many people in Middle America, do 

what they do daily very well, but the reality of life is that there is no time left in the day after 

their work day and evening family commitments end for them to proactively seek out 

education and advice on saving and investing. What some view as basic saving and investing 

concepts that everyone already knows, is typically not information they know. They are 

starting from a different baseline, and it takes a substantial time commitment to understand 

these concepts well enough to make actual investment decisions independently. 

While it may appear that they have access to this information if they have computers or other 

mobile devices from which they can search the internet, they do not, in my experience, access

this information on their own. It is time-consuming and overwhelming. They are much more 

comfortable working with a live person, and more successful when they do so, both of which 
studies have demonstrated.1

And with retirement savings and retirement plan participation at 

such low levels, it is imperative that we help Middle-Income Americans in every way possible 

get on track toward ensuring better futures for themselves and their families. 

Working with Middle-Income Americans to achieve their financial goals is what I have done my 

entire career in the financial services industry. A story about two particular clients of mine 

comes to mind. 

I once met a client after his prior financial representative decided to pursue a new career 

opportunity. The assistance I have been able to provide him over the past 25 years has helped 

him from making several financial mistakes. For example, he called me during the recessions of 

2001 and 2008 because he needed reassurance with his IRA investments. I also recently 

discovered that he wanted to cash out of a variable annuity that he had purchased elsewhere 

and had owned for some time. I encouraged him not to cash out. He is approximately 75 years 

old now. After I explained the surrender fees and the lifetime income options, he changed his 

mind because he wanted to continue receiving lifetime income. It was the right decision for 

him. 

Also, another gentleman and his wife who once purchased a long-term care policy from me 

recently expressed their desire to buy a variable annuity. The husband is about 70 years old. 

Despite the wife having her checkbook in hand during our conversation, I recommended they 

not purchase an annuity because it was not the right product for their particular circumstances. 

He may need some of the money that he wanted to invest in an annuity in a few years. He 

thanked me for the guidance I provided. 

It is my belief that the Proposed Rule and the BIC Exemption as drafted will eliminate or 

substantially reduce people like this couple’s access to education and advice, at the exact time 

and for the exact purpose they need it most – saving for retirement. I fear that the translation 

of education into advice, the imposition of the new BIC contract, the uncertainties created by 

the Impartial Conduct Standards which substantially increase liability costs and effectively 

disqualify the commission model, and the costs of complying with all of the many disclosure 

requirements will cause firms such as PFS Investments Inc. to conclude that it simply is not 

feasible to open smaller accounts. If a decision like this is made, my clients will lose access to 

the education and advice they so badly need, and their futures will be severely negatively 

impacted as a result. 

It is my hope that the Department will take this into consideration and withdraw the Proposed 

Rule. Thank you again for the opportunity to comment.

 

1

Oliver Wyman: The role of financial advisors in the US retirement market (July 6, 2015). Oliver Wyman states that 

it “. . . was engaged to perform a rigorous investigation of the role of financial advisors in the US retirement 

market, and quantify differences in investing behavior and outcomes between advised and non-advised 

individuals.”
Sincerely,

Thomas R. Pool

Wichita, Kansas