Although Lauren Locker was thrust into the leadership of the National Association of Personal Financial Advisors unexpectedly, she is ready for the challenge.
She steps into a position that was supposed to be filled by Ron Rhoades, who abruptly resigned from the NAPFA board Aug. 20 following compliance violations in Florida by his firm, Scholarfi Inc. She was elected chairwoman Aug. 31 and began serving Sept. 1.
Ms. Locker takes over for Susan John, who had been NAPFA's chairwoman for two years.
Ms. Locker, founder of Locker Financial Services LLC in Little Falls, N.J., and former chairman of NAPFA's Northeast/Mid-Atlantic Board, has served on the association's national board for the past two years.
She said that her experience in NAPFA's governance structure and Ms. John's efforts to prepare the way for a successor facilitated her quick transition to the national leadership position.
“Ron and Susan had a three-month window of planning for the handoff,” Ms. Locker said. “Susan and I had about three minutes, but I feel confident. Getting up to speed is not an issue for me.”
ADVISER SRO
Don't look for Ms. Locker to be quite as vocal as Mr. Rhoades about one of the biggest issues facing the investment advisory sector — the potential establishment of a self-regulatory organization for advisers. A bill that would authorize one or more SROs has been introduced in the House but has yet to come up for a vote in the House Financial Services Committee.
Investment advisers oppose an SRO, calling it a costly additional layer of regulation that threatens the viability of small firms. They prefer that oversight remain with the Securities and Exchange Commission, with additional funding to allow it to increase the number of adviser examinations it conducts each year.
Supporters contend that an SRO is required to strengthen investor protection by increasing the number of annual adviser exams beyond the level that the SEC can achieve.
Mr. Rhoades cut a high profile as a frequent and strident critic of the SRO concept and of allowing the Financial Industry Regulatory Authority Inc. to fill that role. He was a constant presence on social media, pounding out statements on Twitter castigating Finra.
In a statement, Mr. Rhoades said he would decline the NAPFA chairmanship in part because his effectiveness as an SRO opponent would be undermined by his firm's compliance problems in Florida, which were cleared up without him being fined or sanctioned.
SEVERAL VOICES
“If all of his t's weren't crossed and i's dotted, it would deter from his message,” Ms. Locker said. “He didn't want that to take away from what he was trying to get across.”
Ms. Locker's will be only one of several central NAPFA voices opposing an SRO.
“I have enough knowledge to speak intelligently on it, but I don't have to be the sole spokesperson,” she said. “It will be a collaborative effort among NAPFA staff and members to make certain that our voices are heard during this time.”
Although the bill is dormant, it could come back to life when Congress returns from its summer recess this week.
“It's never over till it's over,” Ms. Locker said. “There's always an opportunity for it to rear its ugly head again.”
Ms. Locker also has internal challenges on her agenda for NAPFA, which comprises more than 2,400 fee-only advisers.
For instance, the organization has to decide how many of its education conferences will be provided online as opposed to traditional gatherings at a central meeting place.
In addition, it is about to beta test a peer review selection process for NAPFA membership that would replace the process involving the submission of a written financial plan.
[email protected] Twitter: @markschoeff
