Sheila Bair, former
FDIC chair under President Barack Obama and former President George W. Bush, has joined retirement robo-adviser Blooom as its first advisory board member.
Blooom, which has $300 million in assets under management, hopes to use her experience in the financial crisis and her expertise in savings, student debt and policy to better position itself in an rapidly evolving industry. The Department of Labor's fiduciary rule, which Blooom embraces, is a prime example.
Ms. Bair is "a good sounding board as we enter a world where we are effectively running toward the fiduciary standard and many financial institutions are running away from it," Greg Smith, president of Blooom, said in an interview on Tuesday.
The online investment adviser offers digital advice to established 401(k) and 403(b) plans by looking at current portfolios and seeing where clients can do better to cut fees and grow their assets. It has analyzed almost 18,000 accounts with a total of more than $1 billion in assets, and found 83% of them are invested incorrectly, according to its website.
Ms. Bair is currently the president of Washington College in Chestertown, Md. In her first year in that role, she instituted a one-year tuition freeze for the 2016 academic year to thwart tuition hikes and ease rising student debt. As the 19th chairman of the Federal Deposit Insurance Corporation from 2006 to 2011, Ms. Bair pushed against the "too big to fail" model, saying supervision was necessary to avoid institutions from swelling so large that the rest of the financial system would be threatened were they to crumble.
Mr. Smith said Ms. Bair's background and decisions made her a natural fit as the inaugural board member, because they align with the company's mission.
"What we admire about Sheila Bair is her objectivity and the fact that throughout the financial crisis she thought about what is right for people and the general public," Mr. Smith said.
