July 10, 2008
This ruling certainly exhibits the revolting characteristics of how the SEC is in bed with corporate interests. How much in additional fees will the SEC collect if Indexed Annuities are regulated as securities? How much will FINRA collect in revenue? How many billions will the Broker Houses collect in commissions?
These priducts are already heavily regulated by the States. When I sell a variable annuity, I earn about 8% commission. The trails and the upfront commission far outweigh the initial commission of an indexed annuity, which generally are around 4% to 8% across the board. If the SEC suceeds in controlling the marketing and purchasing of FIAs, it will diminsh the "savings" benefit of this product by making it harder to get. For example, many people do not have brokerage accounts or even need one, so to make a FIA a brokerage product will only benefit the brokers.
When is the SEC going to make an effort to protect the consumer and not the brokers? The SEC is in the back pockets of the big investment houses - AGAIN