FPA Government Relations Office
1615 L Street, N.W., Suite 650
Washington, D.C. 20036
Web site: www.fpanet.org
December 7, 2001
Mr. Jonathan G. Katz
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549-0609
Re: Release Nos. 34-42099 and IA-1845; Certain Broker-Dealers Deemed Not To Be Investment Advisers
Dear Mr. Katz:
The Financial Planning Association ("FPA")1 thanks Chairman Pitt for meeting recently with representatives of FPA to discuss the pending Release Nos. 34-42099 and IA-1845 ("Release"), in which the Securities and Exchange Commission ("SEC" or "Commission") seeks through its rulemaking authority to clarify the regulatory status of certain brokers and dealers providing advisory services (hereinafter, the "rule" or the "proposed rule"). Pursuant to our discussion, we are submitting additional comments with respect to the Nov. 4, 1999, proposed rule.
In its comment letter of January 14, 2000, FPA objected to the proposed rule based on three fundamental flaws that FPA considers relevant today and reaffirms in this letter. First, we believe that the proposed rule ignores congressional intent by vacating the special compensation test for the broker-dealer exemption in Section 202(a)(11)(C) of the Investment Advisers Act of 1940 (the "Advisers Act"), resulting in the creation of an entirely new exempted "class" of brokerage firms. Second, we expressed our concern that the proposed rule relies too heavily on the ambiguous second prong of the original broker-dealer exemption test -- a "solely incidental" standard -- as a fundamental basis of the new exemption. Third, we commented that the proposed rule does nothing to enhance investor protection and in fact erodes the existing fiduciary standard by not applying it to similar advisory activities of broker-dealers.
FPA does not wish to revisit ground covered by the many comment letters submitted to the Commission over the past two years. However, we would like to expand upon our previous comments opposing the proposed rule by elaborating on two important issues that we do not believe were adequately addressed in the Release or comment letters, and by bringing to the Commission's attention certain adverse consequences the proposed rule would have on currently pending federal legislation:
(i) the absence of discussion in the Release of the basis for granting an exemption to a new class of persons under Section 202(a)(11)(F) of the Advisers Act;
(ii) the departure of the proposed rule from earlier SEC interpretations applying the "solely incidental" standard to broker-dealers; and
(iii) the unanticipated adverse effect that the proposed rule would have on pending legislation that would amend the Employee Retirement Income Security Act of 1974 ("ERISA") to permit personalized investment advice to ERISA plan participants.2
II. SEC Discretionary Authority to Create New Exemptions
FPA and other commenters have, among other things, objected to the Commission's interpretation of congressional intent in relation to the existing broker-dealer exemption. The Commission's authority to issue the proposed rule ostensibly arises from three provisions of the Advisers Act. Section 211(a) of the Advisers Act grants the Commission authority to promulgate, amend or rescind rules, among other things, to classify persons and matters within its jurisdiction and prescribe different requirements for different classes of persons or matters.
In addition, sections 202(a)(11)(C) and 202(a)(11)(F) of the Advisers Act state that the definition of "investment adviser" does not include
(C) any broker or dealer whose performance of such services is solely incidental to the conduct of his business as a broker or dealer and who receives no special compensation therefor[.]...or
(F) such other persons not within the intent of this paragraph, as the Commission may designate by rules and regulations or order.
In the Release, the Commission acknowledges that the proposed rule does not fall within Congress' intent under subparagraph (C). Subparagraph (C) generally requires that, for a broker-dealer's advice to be excluded from the definition of "investment adviser," the advice must be "solely incidental" to its business, and such activity must not be the source of "special compensation." The SEC recognizes that receipt of fee-based compensation by broker-dealers as proposed by the rule may constitute special compensation under the Advisers Act "because it involves the receipt by a broker of compensation other than traditional brokerage commissions."3
Accordingly, the Commission relies on subparagraph (F), the provision that Congress devised permitting the Commission to create other exemptions for persons who are "not within the intent of this paragraph." [Emphasis added.] In making its argument for the new exemption, the Commission asserts that "[w]hile in 1940 the form of compensation a broker-dealer received may have been a reliable distinction between brokerage and advisory services, development of the new brokerage programs suggest strongly that it is no longer."4 It is certainly clear that the powers granted to the Commission in subparagraph (F) reflect Congress' intent that the SEC should be able to create new classes of exemptions. However, there is no evidence to support the proposed rule's implication that the Commission has the authority to redefine existing ones, including "traditional full-service broker-dealer programs."
A review of the legislative history of the Advisers Act shows that Congress meant what it said about broker-dealers and special compensation. The statute's definition of investment advisers "specifically...exclude[s]...brokers (insofar as their advice is merely incidental to brokerage transactions for which they receive brokerage commissions)."5 [Emphasis added]. Subsequent SEC interpretations in the 1980s and 1990s generally appear to have followed congressional intent.6 With respect to legislating by rulemaking, at least one court decision also rejected the Commission's efforts to amend statutory definitions and regulate banks as broker-dealers under the Securities Exchange Act of 1934 by using its power to define technical terms. 7 In the current instance, Congress's specific, detailed industry exclusions to the definition of investment adviser cannot be squared with the idea that Congress gave the Commission free license to rewrite those existing classes of exclusions defined by statute. Nowhere in the Release is the authority for creating a new exclusion to an existing brokerage activity discussed. We believe that it is critical that the SEC examine in any adopting Release the legal and policy basis for adding a new exclusion that in effect amends by Rule, and not by legislation (as it should), an existing statutory exemption.
III. SEC's Traditional Reliance on Special Compensation Test.
Over the past 61-year history of the Advisers Act, the Commission has placed significant emphasis on the "special compensation" element of the two-prong broker-dealer exemption, and very little on the "solely incidental" test when interpreting a broker-dealer's exclusion under the Advisers Act.8 Under the proposed rule, however, "the nature of the services provided, rather than the form the broker-dealer's compensation takes, would be the primary feature distinguishing an advisory account from a brokerage account."9 Yet an ensuing discussion of the differences between traditional brokerage services and those of an investment adviser or financial planner is notably absent in the Release. If the advisory services are different, then the SEC must point out the distinctions for purposes of identifying or determining those advisory activities of the broker-dealer that are not solely incidental to its primary business. If there is no difference in retail activities -- and we are suggesting that except for securities transactions the Commission will find it extremely difficult to outline the differences in services offered between the new brokerage programs and personal financial planning -- then it confirms our belief that there are none other than the embedded sales culture of a broker-dealer and the method of compensation. Absent this clarification by the SEC, then we can only conclude that the Rule fails completely in drawing a distinction between the nature of the services provided by a full service stockbroker with those of a financial planner under the Advisers Act.
Thus, it is difficult understanding why the historical reliance on special compensation as the primary (and more easily defined) test was effectively eliminated in the proposed rule. Notwithstanding the Commission's repeated emphasis on the need to recognize a contemporary "re-pricing" of "traditional full-service brokerage programs"10 (theoretically provided by the brokerage industry since the Great Depression according to the Rule), it apparently creates a completely new regulatory challenge by switching emphasis to the solely incidental test. The result of the Commission's abandonment of the special compensation test, coupled with its inaction by not providing guidance on the solely incidental test, would appear to leave a significant interpretative void by the SEC that harms investor protection.11 During the two years that the proposed rule has been in effect, why haven't there been any complaints or requests from the brokerage industry to clarify the "solely incidental" requirement?12 We explore this question later in this section.
At the very least, the proposed rule ignores past interpretative guidance of the SEC that once suggested a strong distinction between financial planning and full service brokerage programs. In a 1977 no-action letter, Commission affirmed that
[w]here investment advice concerning securities is rendered by the broker or dealer in connection with his business as a "financial planner" for which fees are assessed [emphasis added], such advice may not be solely incidental to the conduct of his business as a broker or dealer. Moreover, under the same circumstances we question whether some part of the compensation received for providing financial planning services should not be attributed to the rendering of investment advice which would be an integral step in the formulation of many financial plans.13
Ten years later, published articles continued to reflect the SEC's position with respect to a broker-dealer offering financial planning services. "Clearly, a broker-dealer should consider registering under the 1940 Act," one writer noted, "if it regularly provides financial plans for clients or discretionary management for more than a small percentage of its clients."14 The author also provided an appropriate perspective of the transactional, short-term nature of brokerage activities compared to the longer-term fiduciary responsibilities of an adviser in noting
[w]hile all advice from broker-dealers to clients presumably takes into account the needs of clients beyond the immediate transaction, such as the suitability of any recommendation, the more difficult questions under this [solely incidental] element arise as advice becomes less transaction-oriented and more personalized to the long-term investment needs of specific clients.15
An effort to broaden the brokerage industry's suitability requirements for its customers did not happen until 1990, more than 50 years after the "full-service brokerage programs" were first regulated by the SEC. The 1990 amendment to the NASD Conduct Rules required broker-dealers who recommended transactions (other than a money market mutual fund) to make reasonable efforts to obtain information about the customer's financial status, tax status, and investment objectives, not unlike the data analysis and collection typically undertaken by a planner in a comprehensive financial planning engagement.16
One might also assume that an asset allocation recommendation would suggest a traditional advisory activity of a financial planner or adviser. This appeared to be the thinking of Commission staff for many years. In a 1986 no-action letter, the SEC determined that providing investment advice was not "solely incidental" to an accounting firm's status under the Advisers Act if the professional charged an hourly fee for professional services and a percentage of assets fee for advisory services.17 As late as 1999, in a no-action letter issued two months prior to publication of the Release the Commission, in a footnote to another Advisers Act issue, continued to recognize that discussion by brokers of asset allocation programs with their clients "would not be solely incidental to their brokerage business."18 In July , however, Merrill Lynch announced its new "Unlimited Advantage" fee-based brokerage program and, along with other wirehouse representatives, met with the SEC to discuss such a program's regulatory implications. The pattern of determining broker-dealer exemptions then moved into a new direction in an apparent effort by the Commission to better align broker-dealers' interests with those of their clients and to be "responsive to the best practices suggested in the Report of the Committee on Compensation Practices ("Tully Report").19 Thus, under the proposed rule, it appears that Commission staff would not recommend enforcement action against a broker-dealer providing the same asset allocation service of an investment adviser, because such activity apparently would meet the solely incidental requirement of the Rule as merely a re-pricing of a "full-service brokerage program." For example, a series of Merrill Lynch print and television ads, published and televised in the winter of 2001 prominently listed among the following services offered in its Unlimited Advantage brokerage program: "...tailor asset allocation to your risk tolerance... [a] personal financial plan including retirement planning, wealth transfer strategies, tax management strategies [and] college tuition forecasting and planning." 20
So returning to the question raised earlier: why would broker-dealers not request guidance under a vague standard upon which the SEC has never relied in the past, and for which it doesn't provide any guidance in the Release? The answer is fairly simple. The practical effect is reliance on the "bright line" discretionary account requirement of the proposed rule.21 In effect, the proposed rule indirectly defines a broker-dealer advisory activity as "solely incidental" only if the broker-dealer does not maintain investment discretion over a fee-based account. The proposed rule also indirectly defines "special compensation" as a fee - in whole or in part - received for managing a discretionary account. According to the Release, such "discretionary accounts...would be considered advisory accounts because they bear a strong resemblance to traditional advisory accounts, and it is highly likely that investors will perceive such accounts to be advisory accounts."22 However, discretionary accounts for which commission-only compensation were received would still be considered brokerage accounts under the proposed rule.23 In summary, notwithstanding the Commission's effort to discard "special compensation" as a test in the proposed rule, and failing to provide clarity on "solely incidental" activities of a broker-dealer, such requirements still remain, albeit severely weakened.
Thus, broker-dealers have no need to ask the SEC for clarification of the "solely incidental" requirement. Under the proposed rule, the "solely incidental" requirement in effect becomes regulatory window dressing, permitting broker-dealers to freely provide traditional investment adviser/financial planning services without the risk of becoming fiduciary advisers unless they maintain discretion of a fee-based account. Accordingly, the proposed rule amends the long-standing 202(a)(11)(C) broker-dealer exemption under Section 202(a)(11)(F), thereby directly contravening congressional intent.
IV. Proposed Self-Dealing Relief under ERISA and the Broker-Dealer Exemption.
Legislation working its way through Congress poses a new problem for investor protection since the Release was first published and when considered in the context of the proposed rule. So-called "ERISA advice legislation" introduced in the 106th Congress and the current Congress would permit broker-dealers to provide advice on retirement plans subject to ERISA without being required to register as investment advisers.24 The current proposal, H.R. 2269, has received serious consideration, recently passing the House of Representatives. Because the proposed rule eliminates "special compensation" as an Adviser Act registration requirement, broker-dealers for the first time would be able to charge fees for giving advice by combining the new safe harbors under the proposed rule and the ERISA legislation to greatly expand unregistered advisory activities.25
Without entering into a broader discussion of the impact of the proposed legislation on the banking and insurance industries, we urge the Commission to address this issue in any final rule and to advise whether such advice would be solely incidental if the broker-dealer does not hold discretion over an employee's fee-based account that includes 401(k)s, IRAs, or other pension plans subject to ERISA. Given the fact that ERISA was enacted 40 years after the Securities and Exchange Act of 1934, and defined contribution plans were largely unheard of until only a few decades ago, would the Commission consider such ERISA advisory programs to be consistent with the "solely incidental" exclusion as envisioned by Congress for traditional brokerage programs in 1940? Some of the protections of the Advisers Act not afforded to ERISA plan participants under brokerage laws - or banking and insurance statutes for that matter -- include extensive disclosure of the fiduciary adviser's qualifications, prohibitions on client testimonials, disclosure of paid solicitor arrangements, and consent to principal trades.
V. Other Issues.
Brokerage Account Disclaimers. Section 275.202(a)(-1(a)(3) of the proposed rule would require advertisements and contracts to "include a prominent statement that the accounts are brokerage accounts." FPA and others objected to this provision because of the concern that brokerage customers would not understand the nature of the disclosure. However, we are encouraged by subsequent statements of Commission staff expressing an interest in making such disclaimers to the consumer more meaningful. Since publication of the Release, it is at least worth noting how Merrill Lynch, as the dominant wirehouse in the brokerage industry, has advertised its financial planning programs in light of the Commission's concern that such practices were inappropriate.
We have observed that some broker-dealers offering these new accounts have heavily marketed them based on the advisory services provided rather than the execution services, which raises troubling questions as to whether the advisory services are not (or will be perceived by investors not to be) incidental to the brokerage services.26
The Merrill Lynch full-page ads prominently showcase, among other services offered in its Unlimited Advantage program, the financial planning services cited earlier in this letter. 27 Of the 21 services listed under the Unlimited Advantage program, only two mention execution services.28 The so-called "prominent" disclaimers are in approximately 8-point typeface about the size below, located at the bottom of the page, and begin:
*Unlimited Advantage is a brokerage service appropriate for investors who are interested primarily in securities transactions other than buying eligible mutual funds and underwritten offerings....
We respectfully ask the Commission to step back and review such marketing practices through the prism of its primary constituent, the consumer. We would strongly suggest that no reasonable person would consider the placement and size of these disclaimers to be "prominent" and in accordance with the minimum disclosure requirement of the proposed rule. As a result, the public is left confused as to the fiduciary protections, or lack thereof, of such fee-based programs.
In summary, the Release provides no guidance as to what is meant by "prominent," as broker-dealers actively market their "incidental" advisory services, and not their traditional execution services. If the proposal is adopted, we urge the Commission to provide meaningful disclosure to consumers so that they understand the distinctions between varying levels of investor protection afforded under the respective securities laws.
Broker-Dealer Assets under Management. One amendment to Form ADV in the proposed rule that has attracted little comment is the proposed change to permit a broker-dealer to include in its calculations of assets under management its advisory and brokerage accounts for which the broker-dealer has discretion.29 On one hand, the Release states that certain brokerage accounts would not trigger investment adviser registration with the Commission because of the nature of the accounts.30 On the other hand, such brokerage accounts could be included in calculating the broker-dealer's eligibility for SEC adviser registration if it determines it must register. Such a provision provides a distinct advantage over state-registered investment advisers who may prefer a federal regulatory environment but who do not have an equivalent springboard for calculating assets under management.31 Such a decision gives the appearance of favoring one industry segment under the Commission's jurisdiction over another. In response to the question posed in the Release: "Should all discretionary accounts of broker-dealers be treated as advisory accounts?"32 The answer is an unequivocal `yes,' for purposes of fair and consistent treatment of broker-dealers and investment advisers.
Setting aside the complex issues raised by the Release, the practical, market reality surrounding the proposed Rule is that consumers have increasingly opted over the past two decades toward fee-based advisory services offered by investment advisers, not brokerage services. As a result, the brokerage industry simply followed the money. It is not a re-pricing of existing services, but a reinventing of a Depression-era industry with a contemporary marketing moniker that, prior until publication of the Release, required dual registration.
It is interesting to note recent remarks made by Chairman Pitt with respect to the proposed rule that are consistent with the above trend.
Just as investors' needs are changing, market professional are rethinking and reinventing the services they provide, their role and their compensation structure.... Brokers and investment advisers are offering financial services that seem more and more alike.33
Until publication of the Release, brokers who offered such hybrid services, such as wrap-fee programs, registered dually as brokers and advisers. If the consolidation of financial services continue along the current path, then industry trends re-enforce more than ever the critical need for the proposed rule to clearly define the distinction between the financial services separately offered by brokers and investment advisers, so that the "solely incidental" requirement has real meaning.
Also, if the Tully Report's recommendations are to be heeded by aligning the broker's interest more closely with the client's and removing incentives to churn, then certainly the Advisers Act provides a prophylactic barrier to fraudulent sales practices and promotes a more protective environment for investors. It has only been in the last few years that the wirehouses began seeing quite clearly what the smaller, more flexible independent broker-dealers had realized many years previously, that with transaction compensation gradually being reduced to minimums, the most rapid growth was in fee income. One only has to look to the Commission's own industry statistics to see the significant reduction in investors' trading costs as a percentage of their stock market value over the last two decades, and the corresponding growth in assets managed by investment adviser firms.34
FPA remains concerned that, absent any new plans by the Commission to withdraw or significantly revise the proposed Rule, broker-dealers will continue to take advantage of the broad loophole from adviser registration while prominently marketing their "traditional brokerage" services as financial planning. Interested parties affected by the proposed rule such as FPA members or consumers currently do not have a viable option to challenge the legal basis for a poorly constructed rule until one is adopted. Continuing to permit advisory activities by broker-dealers over the last two years sets an extremely poor policy precedent that will erode over time the investor protections and proud legacy of the Commission in safeguarding more than six decades of investor protection under the Advisers Act. We respectfully ask the Commission to act expeditiously by simply withdrawing the Rule.
Please do not hesitate to contact the undersigned if you have any questions or comments.
Duane R. Thompson
FPA Director of Government Relations
cc: Honorable Harvey Pitt, Chairman
Honorable Isaac C. Hunt, Jr., Commissioner
Honorable Laura S. Unger, Commissioner
Paul Roye, Director of the Division of Investment Management
|1||The Financial Planning Association is the largest organization in the United States representing financial planners and affiliated firms, with more than 28,000 members. Most FPA members are affiliated with investment adviser firms registered with either the SEC or state securities administrators, or both. FPA maintains administrative offices in Atlanta and Denver, and a government relations office in Washington, D.C. For additional information, please consult our web site at www.fpanet.org.|
|2||See H.R. 2269, 107th Congress.|
|3||See Release at 7.|
|5||S. Rep. No. 1775, 76th Cong., 3d Sess., 22 (1940).|
|6||See letter to Robert S. Strevell from Investment Management Division Chief Counsel (publ. Avail. April 29, 1985). "We believe that the qualifying term "special [compensation]" in the broker-dealer exception clearly indicates that Congress was concerned with compensation other than that received by a broker-dealer in the ordinary course of its brokerage activities, i.e. commissions." See also Townsend and Associates, Inc., no-action letter (pub. avail. Sept. 21, 1994). "The staff has stated that, for purposes of the broker-dealer exclusion, special compensation generally refers to compensation other than commissions from brokerage transactions."|
|7||See American Bankers Association v. Securities and Exchange Commission, 804 F.2d 739, 754-55 (D.C. Cir. 1986).|
|8||Thomas P. Lemke, a former Chief Counsel in the Investment Management Division, wrote, "Neither the SEC, through its rulemaking powers, nor its staff, in no-action letters, has issued a comprehensive or definitive interpretation of this concept in part because any interpretation of the [solely incidental] element is dependent on the specific facts and circumstances." Lemke, "Investment Advisers Act Issues for Broker-Dealers," Dec. 9, 1987, Securities & Commodities Regulation, at 214.|
|9||Release at 10.|
|10||Release at 3.|
|11||IA Release No. 1092, the seminal interpretative position of the SEC on the Adviser exemptions, does not address the solely incidental activities of broker-dealers. It states that the exclusion "is not available, for example, to a lawyer or accountant who holds himself out to the public as providing financial planning, pension consulting, or other financial advisory services. In such a case it would appear that the performance of investment advisory services by the person would not be incidental to his practice as a lawyer or accountant." For broker-dealers, it references only the special compensation test in stating that the exclusion "would not be available to a broker or dealer, or associated person of a broker or dealer, if the person receives any special compensation for providing investment advisory services." IA Release No. 1092 at 12.|
|12||The Commission has stated that until a final rule is adopted, the Division of Investment Management will not recommend action against broker-dealers complying with the requirements of the proposed rule, based on the form of compensation received. See Release at 4.|
|13||See Investment Management & Research, Inc. no-action letter, (pub. Avail. Jan. 27, 1977), at 2.|
|14||Lemke at 216.|
|15||Lemke at 215.|
|16||NASD Conduct Rule 2310.|
|17||Hauk, Sole & Fasani no-action letter (pub. avail. May 2, 1986), at 5.|
|18||See BISYS Fund Services, Inc. no-action letter (pub. avail. Sept. 2, 1999), at 6.|
|19||Release at 6. See also Report of the Committee on Compensation Practices, Apr. 10, 1995.|
|20||The New York Times, Sunday, Feb. 4, 2001, at 8-9.|
|21||Section 275.202(a)(11)-1(a)(1) of Rules and Regulations to the Advisers Act.|
|22||Release at 10. In this context, the Release also re-defines "special compensation" without directly saying so by noting that a "regulatory distinction would continue to be drawn based solely on the pricing of a [discretionary] advisory service." In effect, this means that a discretionary brokerage account paid through commission transactions would continue to be a brokerage account, while the identically managed brokerage account charged an asset-based fee would be an advisory account.|
|23||"...[D]iscretionary accounts from which a broker-dealer does not receive special compensation, e.g., accounts that pay commissions, would still be treated as brokerage accounts not subject to the Act. In this respect, a regulatory distinction would continue to be drawn based solely on the pricing of an advisory service." Release at 10.|
|24||See H.R. 4747, 106th Congress; and H.R. 2269, 107th Congress.|
|25||As proposed in H.R. 2269, a broker-dealer, investment adviser, bank, insurance company or affiliate thereof, would be able to provide personalized investment advice to an ERISA plan participant. Such entities would receive a prohibited transaction exemption for the provision of investment advice under ERISA by acting in a fiduciary capacity to the plan participant and, among other requirements, disclose to the plan participant any material affiliations or contractual relationship of the adviser in such security. See sections 2(g)(1)(A)(i) and 2(g)(1)(A)(ii) of H.R. 2269.|
|26||Release at 11.|
|27||See attached Merrill Lynch ads, New York Times, Feb. 4, 2001, at 8-9; and USA Today, March 28, 2001, at 5B.|
|28||Under the investing category, the following execution services are mentioned: "no commission on most transactions;" and "trading in stocks, bonds and mutual funds."|
|29||Release at 13.|
|30||"...[D]iscretionary accounts from which a broker-dealer does not receive special compensation, e.g., accounts that pay commissions, would still be treated as brokerage accounts not subject to the [Advisers] Act. In this respect, a regulatory distinction would continue to be drawn based solely on the pricing of an advisory service." Release at 10.|
|31||Section 275.203A-2(e) permits state-registered investment advisers to register with the Commission and preempts state registration if such registration is required by the laws of 30 or more states. Since most state-registered investment advisers are small businesses, only a handful have been able to use this exemption from prohibition on SEC registration.|
|32||Release at 10.|
|33||See "Speech by SEC Chairman: Remarks at the SEC Historical Society Major Issues Conference," Nov. 14, 2001, at http://www.sec.gov/news/speech/spch523.htm.|
|34||See SEC 1999 Annual Performance Report, at 24. The Commission report cites the decrease trading costs of 1 percent in 1980 to about .21 percent in 1998 as a percentage of stock market value, attributable "in large measure to the Commission's regulatory environment, its promotion of competition and elimination of anti-competitive practices (such as elimination of fixed minimum brokerage commissions)...." The rapid growth in advisory business is well documented by the Commission and widely followed in the mass media. Assets managed by advisers, for example, increased fifteen-fold between 1985 and 1999, from $1.2 trillion to $18 trillion.|