Why Obama is 'proud' of this adviser

President quoted Sheryl Garrett, founder of an hourly fee network, in supporting fiduciary standards

Feb 24, 2015 @ 12:54 pm

By Liz Skinner

President Barack Obama singled out Sheryl Garrett as an adviser who puts clients' interests first in his speech Monday that backed tougher investment-advice standards for brokers who handle retirement plans.

“I want to emphasize once again, there are a whole lot of financial advisers out there who do put their clients' interests first. There are a lot of hardworking men and women in this field, and got into this field to help people,” Mr. Obama said at the AARP event in Washington. “They're folks like financial adviser Sheryl Garrett.”

Mentioning Ms. Garrett eight times by name, Mr. Obama said he was proud of her, and had the founder of the Garrett Planning Network stand up in the audience, which included between 150 and 200 people.

He also quoted her argument for stronger fiduciary rules, adding, “Couldn't have said it better myself.

“Sheryl says, 'The role of a financial adviser is one of the most important jobs. But there is a segment of the industry today that operates like the gunslingers of the Wild West. We don't have the rules and regulations to protect those who we're supposed to be serving,'” the president said.

In his speech, Mr. Obama said he's directed the Department of Labor to move ahead with its fiduciary rulemaking, something the agency tried to do in 2011 but backed off amid fierce opposition from the brokerage industry.

(More: Is fiduciary a done deal? Not so fast)

The speech criticized advisers who earn “back-door” payments or hidden fees for putting clients into certain retirement investments that don't benefit them.

The DOL was familiar with the Garrett Planning Network's work with middle-income investors and new investors, Ms. Garrett said.

“We send an example that you can make a living servicing middle America as a fiduciary,” said Ms. Garrett, who was back home in Arkansas Tuesday.

Ms. Garrett said she had spoken with a White House speechwriter earlier this month and was called by the president's office last Friday and asked to attend the speech.

“I had no imagination that the president would quote me, let alone ask me to stand up,” she said, calling it a very surreal experience.

Ms. Garrett started her network of hourly based, fee-only financial advisers in 2000. It now has about 300 members, and its founder has been a vocal supporter of DOL issuing new rules for advisers who handle pension and other retirement plans.

She dismisses opponents' argument that under a uniform fiduciary duty middle-income Americans would be priced out of the advice market because brokers would abandon commissions and charge fees based on assets.

Her recognition from the commander in chief earned her kudos from other advisers.

“I'm thrilled for her and for the profession,” said Edward Gjertsen II, 2015 president of the Financial Planning Association. Mr. Gjertsen, who also is vice president of Mack Investment Securities, has known Ms. Garrett for about 15 years.

“Having a level landscape from the regulatory patchwork out there is important, most so for customers,” he said. “It's great that the president recognizes that too.”


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