Subject: File No. 4-606
From: Richard P Terhune, Jr.
Affiliation: Development Manager, New York Life, Southern CT General Office

August 24, 2010

The suitability standard already governing broker-dealers and registered representatives is a robust and heavily enforced standard. Compliance costs - both in terms of finances and time - are high, and those costs are eventually felt by clients. Adding another layer of regulation means another layer of compliance, and even more cost to clients.
Most importantly, the Dodd-Frank Act does not define what the rules are for compliance with a legal "best interest" standard - thus subjecting registered representatives to the potential of never ending lawsuits. For example, is "best" the cheapest recommended product? The "best" premium relative to the benefit of the product? The product with the "best" historic underwriting and service standards? Is it the one from the carrier with the "best" rating?
The fiduciary standard in essence adds a vague legal liability standard that looks back (sometimes after many years) and is enforced after the fact by the SEC or trial lawyers who have perfect vision in hindsight.