A 21-year veteran in the adviser profession, Steven Dimitriou first worked in health insurance. But, once he switched to retirement benefits he never looked back. And while retirement might now look easy in comparison to the market turmoil in health care, many dark clouds remain.
As managing partner at Boston-based Mayflower Advisors and incoming president of the National Association of Plan Advisors - a sister organization of the American Society of Pension Professionals and Actuaries - that is dedicated to retirement adviser advocacy, business intelligence and networking Dimitriou knows the potential pitfalls very well.
He and NAPA organizers say that while the financial services industry is well represented in Washington by a number of trade associations that weigh in on issues affecting advisers, NAPA is the only advocacy group exclusively focused on the issues that matter to retirement plan advisers. This exclusive focus, they say, is what sets NAPA apart from the rest.
EBA recently caught up with Dimitriou to discuss how he and the young organization will attempt to fill the perceived gap in adviser advocacy on behalf of NAPA's more than 3,000 members.
What is your background in the retirement industry?
I started in the insurance industry, and soon after I taught myself retirement plans. I worked for New York Life Insurance Company, and, at least within that company, I became the regional go-to person on 401(k)s and retirement, back in 1991-'92 ...
I recognized pretty quickly at age 23 that although I was in charge of my own [work life], I was very undisciplined. So I recognized that I needed to go someplace with structure. That was around the time I moved on to bigger mutual fund companies in Boston. I joined Massachusetts Financial Services Inc. in 1993, which had a growing and very successful retirement plan product.
I then came to Washington, D.C., in October 1995. It was the start of a fantastic experience. I worked for Alex. Brown & Sons in Baltimore. The job taught me corporate and executive benefits as well as finance. During this time I served as a vice president responsible for retirement sales and service in the Northeast and Midwest.
[In 1999,] I moved back to Boston to build an entire retail products group, broker-dealer and investment bank at H.C. Wainwright & Co., Inc., but eventually formed Mayflower Advisors with a couple of partners in September of 2002.
NAPA is a relatively new organization. How are you keeping members informed about fee disclosures and other subjects at the forefront of retirement plan issues right now?
NAPA has been around for a little more than a year with approximately 3,000 members. It is rapidly growing, and that's a testament to the serious gap that exists in the advocacy marketplace for advisers.
We have a NAPA government affairs alert that goes out on a regular basis; we've tied this in with the efforts of ASPPA. We're about to unveil the NAPA NOW portal, which is a Web-based, one-stop shop for everything [an adviser] needs in the retirement plan space.
The portal will also provide government updates, especially from the Department of Labor, as well as a lot of information on industry trends such as marketing and practice management. But I think we're always going to have one of the core components be advocacy effort; what is actually happening at the DOL, IRS and within the Financial Industry Regulatory Authority.
As the incoming president of NAPA, what do you hope to see happen this year?
Marcy Supovitz [principal of Boulay Donnelly & Supovitz Consulting Group Inc.] will be president through 2012 and I will officially take over in March 2014. NAPA will always have the president, president-elect and president emeritus positions. [The people who hold] those three [positions] will always have a say philosophically in the organization and be involved in the direction of the group. I won't finish my term until 2015. As soon as I begin there's a lot that needs to be done between the conference calls, meetings, and so forth.
Taking the steps to becoming NAPA president has been quite educational and eye-opening, but challenging. Day-to-day, month-to-month activity will become more routine as the organization evolves.
How did you get involved with NAPA in the first place?
Marcy Supovitz nominated me for president. I got involved with NAPA because of my involvement with Retirement Advisory Council. I felt for a very long time that my side of the business was seriously lacking an advocacy group on Capitol Hill, and with state lawmakers and others. We never had a seat at the table when it came to trying to explain to lawmakers and regulators what we saw in the field, how the industry was actually run, what companies were doing, what they should have been doing.
ASPPA CEO Brian Graff had a presentation at the Council and said, "We're trying to do the same thing that we've done in the pension and actuary world; we want to build that out for the advisory community."
After the presentation, as he was trying to run to catch a plane, I ran with him outside and said, "Hey, if you're getting this off the ground I want to get involved."
When [working on creating the] Morningstar-ASPPA 401(k) Advisor Leadership Award ... he remembered that and he gave me a call. So I got onto the leadership council there. I was passionate about what NAPA could become and what it should become and I think that's what helped them to nominate me as the next president.
What does your leadership role with NAPA mean to you as an individual adviser?
For me personally I'm in a position of adding to that voice in Washington, D.C. At the end of the day in the industry the vast majority of advisers and vendors all are trying to do the right thing and I think there needs to be an organization that understands and expresses that. I particularly relish the opportunity to help shape the regulatory and legislative environment. [Lawmakers and regulators] don't know this industry and they look to organizations such as NAPA to learn and look to our clients to learn about what's going on. To have a seat at the table is monumentally important. One big responsibility that I take very seriously is I really hope I can deliver on what I've been trying to preach for years: doing the right thing and making sure this industry moves in the direction it needs to move. At the end of the day the most important thing is the participant in these retirement plans.
It's a very busy time to be in the retirement industry. With many demands to balance within NAPA and your job at Mayflower, how do you keep it all running?
With Mayflower, the way we stay afloat is by recognizing that every change affecting us has an even larger impact on the clients; all these changes have driven home the need for an adviser out there in the marketplace. The good news is our clients need us more and more. It's not as if I'm doing the exact same thing I was a year ago. We have to get out there and communicate to participants and investment committees what some of these new rules are, and how to make their new plans more competitive.
How do you prioritize the issues confronting you and other retirement plan advisers? Is fee disclosure at the top of the list?
Good, legitimate retirement plan advisers have been disclosing fees for years. That has not been a problem. The larger issue is from a regulatory point of view with FINRA; how the changing rules there affect what we have to do. Advisers that have been in this business have had a competitive advantage ... What's become more important over the past few years is finding avenues to keep abreast of the new developments of what's going on out there, and this is where the NAPA NOW portal will help.
Would you like to share an industry tip? Any advice to those who might be new to the market?
[In] everything you do, always consider the impact on the plan participant - first and foremost. As long as you keep that in mind you'll end up doing the right thing and will be successful. The sad stories in the industry are when people lose that focus. I'm lucky that I am still passionate about education. Nothing makes me feel better then when I move the needle on the average Joe's retirement plan on their participation, retirement readiness. It's harder to do today with everything I'm involved with, but that is still my passion.
Update: The original version of this article incorrectly stated when Steven Dimitriou will begin his term as NAPA president. It has been updated to reflect the correct date, March 2014. Additionally, the original version did not include that Dimitriou was employed at a retail products group at H.C. Wainwright & Co., Inc., in Boston. EBA regrets the errors.
Napa's 7 Core Principles
NAPA's mission is to be a leader in the evolution of the national retirement system to improve transparency, effectiveness and governance in an effort to improve the retirement outcome for participants. We embrace new members who support NAPA's core principles, which include:
1. The retirement industry is in transition and NAPA is a leader for positive change.
2. NAPA's core purpose is to enhance retirement security in America.
3. NAPA members focus on providing high quality, professional advice to retirement plans and/or their participants.
4. NAPA members are committed to leading the transition to a more transparent, effective, professionally governed retirement system.
5. NAPA members may serve as either fiduciaries or non-fiduciaries, but are committed to clearly disclosing their fiduciary or non-fiduciary status to their ERISA retirement plan clients.
6. NAPA members pledge to comply with all requirements relating to retirement plans that are or will be required by the SEC, DOL, or any other governing agencies.
7. NAPA members pledge to maintain ethical standards in their representation of plan sponsor and participant clients and will strive to service them under a process that puts their clients' interests first.
Source: ASPPA.org
