NAIFA's Robert Miller pushes for compromise on fiduciary issue

Nov 27, 2011 @ 12:01 am

By Mark Schoeff Jr.

Robert Miller isn't a typical member of the National Association of Insurance and Financial Advisors.

His firm, Miller-Pomerantz and Associates, is located in the New York financial district near Zuccotti Park and in the same building as the Securities Industry and Financial Markets Association. His clientele in large part comprises Wall Street bankers and New York lawyers.

Yet as the organization's president, Mr. Miller, 57, maintains that the vast majority of NAIFA's 50,000 members operate small businesses in small towns. In his narrative, they are part of middle America, building relationships and serving middle-income clients.

Mr. Miller hopes to persuade the Securities and Exchange Commission not to impose a type of fiduciary-duty standard on NAIFA's registered representatives that he contends would force them to abandon the commission-based business model that thrives under the suitability standard.

Perhaps it is a good thing that the tall, lanky Mr. Miller laughs easily. He will need his sense of humor over the next year that he serves as NAIFA's president.

Mr. Miller is heading a group that is accused by advocates of being the primary obstacle to a universal fiduciary-duty standard of care.

Adding to his unusual background for a NAIFA leader, he pursued a doctorate at Columbia University, studying economics, finance and political science. But instead of finishing his dissertation on “sports in the political arena,” Mr. Miller took a yearlong sojourn to Paris.

“I went to Paris and thought I was going to be Ernest Hemingway,” said Mr. Miller, who returned to New York and eventually followed in his father's footsteps in the insurance industry.

Q. What message are you trying to send to Capitol Hill and regulators?

A. Your average NAIFA members [do business] in the small towns where they grew up. They met their wives in high school. They're everybody's friend. They sit on Rotaries and are active in their churches. We are definitely in a relationship-building business. We insure 75 million families across the country, and our products are responsible for about 20% of all savings in this country. Most of the incomes we're dealing with are people who earn less than $100,000. I don't think [regulators] understand that we are not a transactions-oriented group.

Q. In December, NAIFA representatives met with SEC Chairman Mary Schapiro and the other commissioners, including Elisse Walter. How did those meetings go?

A. I started trying to conduct a mock interview with commissioner Walter. I didn't get two words out of my mouth before she said, “You don't do that.” Well, I do do that. I conduct conversations with people before I start to sell anything. I'm looking to get to know people before I even come close to making recommendations.

Q. How is the SEC responding?

A. I do think the SEC is taking a serious look at the potential consequences of overregulation or even changing regulations from suitability to fiduciary. There might be some layers of disclosure in what they're doing. They might be able to work out a way where we are fiduciaries but we can sustain our model of business. Believe it or not, I feel a little more confident with them than I do with the Department of Labor.

Q. What about the Labor Department's fiduciary-duty proposal?

A. I don't really see that they've gotten it yet. You have Congress rise up against the Department of Labor, basically saying, “You're reaching way beyond the [Employee Retirement Income Security Act] to start putting [individual retirement accounts] in the mix.” They're already on record saying they're going to include IRAs in their re-proposal [early next year]. The Department of Labor is very rigid right now.

Q. NAIFA is portrayed as the Big Bad Wolf on fiduciary duty. How do you respond?

A. I'll go one step further. My brother-in-law is chief compliance officer at Morgan Stanley. I have this discussion with him all the time: “You insurance agents get away with murder.” [Mr. Millers laughs.] I feel deep down in my heart that our profession does a whole lot of good. We have not seen evidence from the SEC or any other authority that says what we're doing is working in anything other than the best interests of our clients. I don't think any of us are particularly scared of becoming fiduciaries as long as ... we can sustain a business model that still allows us to make a living. I don't want anyone to think that NAIFA is against good, intelligent regulation. We're not against protecting the consumer. But it's a balancing act. It's got to be intelligent regulation.

Q. Fiduciary advocates say that NAIFA opposes fiduciary duty because it would undermine the sale of annuities.

A. I think it's poppycock; that's just fictitious. A fixed annuity is the most conservative thing you can ever look at. They're saying things that are just not true. It's like me saying that every fiduciary is Bernie Madoff. It's ridiculous.

Q. Annuities have the reputation of being complex. Are you lobbying on Capitol Hill for greater acceptance of them?

A. Our message is a little more general. We believe in helping the public save for retirement. We're not lobbying for a particular product. But all an annuity is is a way of putting money away in a systematized way that one day is going to guarantee that you're never going to run out of money as long as you live. It's no more complicated than that.

Q. What concerns you most about what is happening in Washington?

A. Is there the expertise about my industry in Washington to make good, intelligent decisions on how to regulate us so that it's fair to consumers [and] it's fair to us? The unknown in Washington does not make you feel very good.

Email Mark Schoeff Jr. at


What do you think?

View comments

Recommended for you

Sponsored financial news

Upcoming Event

Mar 13



InvestmentNews is honoring female financial advisers and industry executives who are distinguished leaders at their firms. These women have advanced the business of providing advice through their passion, creativity, inclusive approach and... Learn more

Featured video


Advisers beware: tax law has unintended consequences

Commission accounts could be preferable for some clients, and advisers could be incentivized to move from employee broker-dealers to independent channels.

Recommended Video

Path to growth

Latest news & opinion

Fidelity charging new fee on Vanguard assets held in 401(k) plans

The 0.05% fee is ostensibly a response to Vanguard's distribution model, but may also make the company's funds less attractive due to higher cost.

UBS adviser count continues to decline

Firm to merge U.S., global wealth management units on Feb. 1

TD Ameritrade launches all-night trading for ETFs

Twelve funds now can be traded after-hours, but the list will grow, company says.

Cutting through the red tape of adviser regulation is tricky

Don't expect a simple rollback of rules under the Trump administration in 2018 — instead, regulators are on pace to bolster financial adviser oversight.

Bond investors have more to worry about than a government shutdown

Inflation worries, international rates pushing Treasuries yields higher.


Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting It'll help us continue to serve you.

Yes, show me how to whitelist

Ad blocker detected. Please whitelist us or give premium a try.


Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print