From: Robert A. DiCola
I am very concerned to here that the SEC is considering revising the 12b-1 fee regulations. I am an independent broker/registered representative and I provide financial planning and investment advice to clients in my community. I have been in business for 25 years and find it more difficult each year to earn adequate compensation for the time and effort I put into the business. I am commission based and not fee based. In my situation doing business in the manor that I always have, keeping the clients interest first, removal of the 12b-1 would be devastating. The business requires continued ongoing monitoring of portfolios, meeting with clients to review and adjustments in portfolio as needs change. If 12b-1 fees were eliminated I would receive absolutely no compensation for those efforts. In addition my revenues would by cut in half and would render me unable to function. The only solution would be to become fee based and charge my clients for the service and investment management. My studies of that change in business would provide me with adequate compensation but increase my clients total expenses by 35 to 40%. Fee based professionals in my business earn more than twice the revenues I do for an equal amount of assets under management. But fee based is hardly a benefit to the client or consumer. Please be fair to professionals in the business as well as the consumers who utilize brokers like myself and do not eliminate or lower 12b-1 commissions.
Robert A. DiCola, CLU, ChFC