Phyllis Borzi

White House Memo: A Moment of Opportunity for Fiduciaries to Retirement Plans

February 5, 2015 by admin

Famous showdown between "Fast Eddie" Felson and “Minnesota Fats” in the iconic American film, The Hustler — Showdown between “Fast Eddie” Felson and “Minnesota Fats” in the iconic American film, The Hustler

If you think we’re letting go of the “fumbling children” reference made by FSI chairman Adam Antoniades, you have another thing coming. He reminds me of the proud “Minnesota Fats” character in the classic film The Hustler— he doesn’t want to recognize the truth and talent of the situation he’s faced with by “Fast Eddie” Felson (Paul Newman), because it means that his reign as best player has ended.

Mr Antoniades goes so far to call the leaked White House Memo from January 13 simplistic, though it refers to more PhD studies than his fumbling response could even spell, so he’ll have to try and respond again.

Declaration of Independence

February 3, 2015 by admin

“Can you be more specific?”

Embarrassing, but true: the retirement industry is asking that of the US government.

The definition of a Fiduciary needs to be more specific because of cases where Plan Sponsors are legally charged unreasonable fees for a long time, but the Department of Labor’s interpretation is undesirable to Wall Street. Of course, Wall Street is on the receiving end of these unreasonable fees.

As an investment advisory firm who identifies in writing as a fiduciary to our clients, we uphold the interests of our client above those of any other interest, because we have no other interested parties. The unfortunate reason that other investment advisors will not agree to sign a fiduciary agreement with a client is because they are “promised” to a large company, who profits from a retirement plan through hidden fees.

While the Plan Sponsor is unaware of this other agreement, and often the Investment Advisor is not entirely upfront about this agreement with the Plan Sponsor’s representatives, it comes out in the end through hidden fees and a whole mess of ugly policies.

The sort of game run here should be illegal. Not because the Plan Sponsors are not careful, instead they often are smart and diligent, but because they are simply not protected by the law. Up to this point, the law is unclear. The Independent Advisor they supposedly hire is not, after all, independent according to a stricter definition now proposed by the Department of Labor, led by Phyllis Borzi.

Insist upon a clear definition of an independent advisor so that you know your advice comes for the interest of your retirement plan, and not for the interest of someone else’s quasi-legal activity. Sign the petition at http://www.thepetitionsite.com/414/401/760/tell-washington-to-stand-up-to-wall-street/

Michele L. Suriano, Accredited Investment Fiduciary™, is president of Castle Rock Investment Company, a woman-owned SEC registered investment advisory firm serving qualified retirement plans. www.CastleRockInvesting.com

Not that Complicated

February 2, 2015 by admin

FSI Chairman Adam Antoniades, from Think Advisor — FSI Chairman Adam Antoniades, from ThinkAdvisor

In any fight, there are two sides waving their arms around.

The Financial Services Institute, or FSI, states in response to a recent White House memo that changing the way the delicate fiduciary system is run will ruin everything. The Financial Services Institute, or FSI, is in opposition to redefining the Fiduciary Standard as it is proposed because of various reasons, some more partisan than others. In general, the FSI puts investor advisors first, and the DOL puts workers and clients first.

How could increased or maintained responsibility of advisors lead to greater abuse of power? Among the first things said by the FSI is the atypical “hrrumph, well people outside the industry just don’t understand the complexities of how we deal with these things.” When in reality, it’s not that complicated: you protect the interest of your clients retirement if you are forced to put their interests first under the law, so why not stop dancing around this and just execute the priority anyway?

Demand protection for your retirement you deserve. Sign the petition to here at SaveOurRetirement.org: http://saveourretirement.com/take-action.html

Risk Management: Employee Retirement Plans

January 23, 2015 by admin

Risk Management Castle Rock jumps through hoops to be among the best investment advisors. Not every investment advisor goes through the same rigorous training because these hoops are not legally required. We do not think that making best practices a legal requirement will diminish our status as one of the best firms around, but we do think that selecting an investment advisor should be less risky for Plan Sponsors.

You are supposed to be careful of sales pitches that avoid using the term “fiduciary” but stress “education” instead, because those are not interchangeable services. The difference between these services would be like exchanging accounting for bookkeeping services, or medicine with surgery, or heads with tails in a coin toss. Providing education does not negate a need for a fiduciary; rather, a fiduciary investment advisor should be around for cases where education does not meet the plan’s needs, and an expert opinion is necessary.

How confident are we that Castle Rock is the place to turn? We are the best retirement investment advisor around. You can check our About Us section to be sure, or better yet Contact Us.

Our qualifications exceed all of these expectations, but you may want to check to see if your own advisor is able to eliminate some of the risks to you as a plan sponsor[1]:

At least 50% of assets under management in qualified retirement plans (ours are 99%);
Has an Accredited Investment Fiduciary™ or similar designation;
SEC Registered Investment Advisor (RIA);
Make sure your advisor has been working in the industry for at least a decade;
Get a fee agreement that clearly states how the fees will be charged; and
Make sure that fiduciary status is in writing.

To show your support for conflict-free advice in all retirement plans, please sign the petition here at: http://www.thepetitionsite.com/414/401/760/tell-washington-to-stand-up-to-wall-street/

What’s Going On?

January 22, 2015 by admin

A fiduciary duty, the obligation to uphold the clients’ interest above all else, is Phyllis Borzi’s long sought and tunneled for goal that we at Castle Rock uphold and agree whole-heartedly with. Together, our standards are the highest in the retirement industry. She says that, like in the movie Groundhog Day, bad policies keep being relived over and over. We want to stop the origin of the problem: the poor incentive structure.

Her aim is to make incentives to advisors as straightforward as possible in retirement plans so that the resulting fees will not surprise retirees and leave them with less than they planned.

When investment advisors do not sign up to be fiduciaries to the plans they advise, it leads to corruption and changes the fee structures of these plans so that the retirees no longer have the same security after 65 (typical retirement age). Liability to the Plan Sponsor also changes, and the integrity of the investment advisor themselves is challenged as well.

One example of how the Plan Sponsors are hung out to dry is the John Hancock case, where unreasonable fees were not seen as criminal because of this legal loophole.

Sign your support for reform here at SaveOurRetirement.com!

Are you In or Out?

January 21, 2015 by admin

What sense does it make to pay for investment advice that comes from someone who is putting his or her interests before yours?

The Department of Labor, through Phyllis Borzi, is fighting to make sure that a loophole allowing conflicted advice to retirement plans is closed. As of last week, an online petition was started by consumer groups and retirement industry giants, including AARP, at http://saveourretirement.com/. The petition is to tell Washington to stand up to Wall Street and close the loophole.

We at Castle Rock are proud to endorse this petition.

The low returns that people often find in their 401(k) or IRA accounts are due to fees that are either hidden or “bundled” so that you need hire a detective to figure out who is getting paid and how much. Please do your homework when you look for an advisor for your retirement plan. In America, today, folks can pay for advice that is in conflict with their best interests and there is no law against it.

We are proud to put our clients’ interest first and maintain our independence from compromised business practices. If you support our work and want conflict-free investment advice to be the law of the land, please sign the petition at http://saveourretirement.com/take-action.html.

Are you in or out? Will you join the fight for qualified retirement investment advice?

White House Memo: A Moment of Opportunity for Fiduciaries to Retirement Plans

Declaration of Independence

Are you In or Out?

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