November 17, 2008

Subject: File No. S7-14-08 Index Annuity Sales need to be regulated!

I'm an FPA member who supports the proposed rule. I have insurance licenses in many states and have also been securities licensed for many years.

My cousin recently was told that Equity Indexed Annuities were "no cost" as long as he bought legal services developing trust documents from a certain vendor. I asked him if the vendor questioned whether he needed trust documents and whether he could just get the Equity Indexed Annuities at no load and no surrender charges; he said they (the vendor) only offered them bundled.

This kind of misdirection needs to be stopped. People rely on honesty in business and without some sort of registration (with qualifications) and threat of ruined reputation for misleading we will continue have problems in the industry. The whole financial industry gets tarred with scandal, even if the items aren't regulated.

I believe national regulation is the way to go and the SEC is set up to handle this. If there was a national Insurance Commission that would streamline multi-state regulation I would certainly ponder putting the responsibility with them. Now there's an idea. Create the national insurance regulatory body with this as its first responsibility.

Thanks you for your interest, Sam

Samuel M. Fox, IV CFP®
Vice President – Financial Consultant
RBC Wealth Management - Consulting Group