Adviser groups boost political spending to gain Capitol Hill influence

At least four trade associations reached their highest levels of donations in this election cycle, the FEC reports.
OCT 21, 2016
Several trade associations representing investment advisers and brokers are donating a record amount to political campaigns in an attempt to elevate their profile on Capitol Hill. The Financial Planning Association, the Financial Services Institute, the Insured Retirement Institute and the Investment Adviser Association have all reached their highest levels of political spending in this election cycle, according to Federal Election Commission filings. For each of them the goal is to grab the attention of lawmakers right where they often focus — on their re-election prospects. The groups usually contribute to incumbents in both parties who serve on committees of jurisdiction over adviser issues, such as House Financial Services, Senate Banking, House Ways and Means, and Senate Finance, among others. Each interest group lobbies lawmakers on adviser topics. Augmenting that effort with support from their political action committees can take the dialogue to a new setting — a fundraising event rather than the legislator's Capitol Hill office. “PAC checks don't buy votes, but they help us get face time off the Hill, which is just as important as face time on the Hill,” said Karen Nystrom, FPA director of advocacy. “The more you meet somebody, the more they get to know you.” So far in the 2016 election cycle, which began on Jan. 1, 2015, FPA has donated $81,500, up from $57,500 in the 2014 cycle. The IAA has donated $40,000, compared to $34,000 in 2014.
Campaign spending by advice industry trade groups
Source: Federal Election Commission.
Adviser groups still spend a relatively small amount of money on campaigns compared to the major brokerage and insurance trade associations, such as the Securities Industry and Financial Markets Association ($695,750 in 2016), the Investment Company Institute ($1.9 million) and the National Association of Insurance and Financial Advisors ($2.2 million). But even modest contributions help advance the adviser agenda. “There's an increasing sensitivity on Capitol Hill to our concerns,” said Neil Simon, IAA vice president of government relations. “There's an increasing awareness of the role Capitol Hill plays in the regulatory environment, and investment advisers have a major stake in that.” The IRI's steadily increasing political spending — $173,000 in the 2016 cycle compared to $139,000 in 2014 — reflects an organizational priority and monetary support of the PAC by the group's 32-member board. “It's part of our overall strategy, and it's finally starting to come together,” said Cathy Weatherford, president and chief executive of IRI, which focuses on retirement income products. “It gives us the ability to be part of the growing chorus for positive outcomes for Americans' financial security.” The FSI, which represents independent broker-dealers, attributes reaching its highest level of political spending — $335,000 in 2016, compared to $286,000 in 2014 — to its members' focus on policy and politics. “As our membership has significantly grown, so has our members' understanding that they need to take part in the advocacy process, in order to protect their businesses and their clients' access to their advice,” FSI spokesman Chris Paulitz wrote in an email. Another insurance group, the American Council of Life Insurers, has increased the size of its PAC significantly — though it can't be confirmed it is at an all-time record level — giving it the ability to donate to more lawmakers. The group has spent $1.2 million so far in 2016, up from $663,000 in the 2014 cycle. “The increase in campaign contributions reflects the ACLI political action committee's growth and the importance of being involved in the political process,” ACLI spokesman Jack Dolan wrote in an email.

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