Deals & People August 7, 2020

Retirement Industry People Moves

CAPTRUST selects VP and institutional financial adviser; Insight Investment adds leaders to North American practice; NFP acquires multidisciplinary insurance broker; and more.

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Art by Subin Yang

Art by Subin Yang

CAPTRUST Selects VP and Institutional Financial Adviser

CAPTRUST Financial Advisors has added Frank Pyles, a Phoenix, Arizona-based financial adviser. Pyles joins the team as a vice president and will serve as an institutional financial adviser for the firm.  

Pyles will be responsible for developing new institutional client relationships. He will report to Mike Hudson, senior director of institutional consulting at CAPTRUST. 

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Pyles brings nearly two decades of experience in the financial advisory industry to CAPTRUST. Prior to joining the firm, he spent 15 years with The Vanguard Group, most recently serving as regional director of defined contribution (DC) retirement solutions. Before joining Vanguard, Pyles was a financial adviser at Harris Trust & Savings Bank and Edward Jones Investments in Phoenix.

“As I learned more about CAPTRUST, I could immediately tell that what they are doing is truly unique,” Pyles says. “The opportunities across the firm’s institutional and wealth management businesses, and its rapid expansion in recent years, made it stand out as an exciting and innovative place to work. The addition of a strong culture of support, collaboration and motivation made the opportunity to join CAPTRUST too good to pass up. I am excited to work with the CAPTRUST team to expand the firm’s presence in the Southwest and bring all of the wonderful opportunities they offer clients to this market.”

“Frank stood out not only as a perfect cultural fit, but as someone with experience that we know will drive continued success for our institutional business,” Hudson says. “We are proponents of a collaborative environment, and with every new adviser—like Frank—who joins CAPTRUST, advisers across our entire network benefit.”

Insight Investment Adds Leaders to North American Practice

Insight Investment has hired Angela Ruane as director of Business Development and Mark Henesy as consultant relations manager at Insight North America.

Jack Boyce, head of distribution for North America at Insight, says, “The U.S. represents a compelling growth opportunity for Insight, and we continue to add to our world-class team. Angela and Mark will bolster our ability to deliver solutions to meet industry-wide challenges and help investors and their consultants build investment programs focused on certainty of outcome. As U.S. pension plans continue to shift from accumulation to decumulation, they have become increasingly focused on providing benefits to retirees. Insight is well positioned to work with investors and leverage its expertise to maximize investment outcomes.”

Ruane most recently served as the director, Institutional Business Development at Allianz Global Investors, working across multiple geographies and channels to deliver institutional solutions. She joined the distribution team to expand its reach across the U.S. institutional market and is responsible for building engagement strategies with public retirement programs as well as outsourced chief investment officer (OCIO) firms, health care organizations and corporate plan sponsors. Ruane is based in New York and reports to Jeremy King, head of Business Development.

Henesy joined Insight from BlackRock, where he spent almost a decade in operations and institutional client-facing roles with a particular focus on building relationships with investment consultants. He will work to increase Insight’s partnership with consultants as part of the firm’s strategy to support retirement plan sponsors as they look to meet their liability and liquidity needs. His hire completes the build-out of the North America Consultant Relations team. He is based in New York and reports to Jon Morgan, head of Consultant Relations, North America.

NFP Acquires Multidisciplinary Insurance Broker

NFP has acquired Rose & Kiernan Inc., in a transaction that closed effective as of August 1.

Rose & Kiernan, based in Albany, New York, is a multidisciplinary insurance broker with capabilities in property and casualty (P&C) insurance, surety and employee benefits. The firm provides a variety of solutions—including insurance, employee benefits and risk management—to businesses, individuals and public and private organizations primarily in New York state and New England. John Murray, president, chairman and CEO of the firm, will continue to lead the team and operations in Albany and report to Bill Austin, president of the Northeast region.

“Adding an organization like Rose & Kiernan elevates the depth and breadth of our capabilities, while providing resources that will maximize their growth,” Austin says. “They have a long history of helping organizations thrive by effectively managing risk and attracting and retaining talented professionals and we’re proud they see the value we provide in helping them be an even better partner for their clients.”

“Expanding our middle market capabilities is a key element of our P&C strategy,” adds Henry Lombardi, executive vice president and head of NFP Property and Casualty. “Being able to add a firm that has achieved so much and is positioned for significant growth is an important step as we add scale and expertise that will enhance our business.”

Principal Financial Group Announces New Customer Experience Lead

Jennifer Oyler has joined the global marketing team at Principal Financial Group as head of customer experience.

“Jenn brings demonstrated expertise and leadership to Principal, which will help transform the way we interact with our customers externally and employees internally,” says Beth Wood, chief marketing officer for Principal. “Her demonstrated ability to bridge research and analytics with systems and processes will be instrumental to our vision of creating superior connectivity and relationships with the users of our products and services.”

Oyler comes to Principal with more than 20 years of experience. She most recently worked at Decooda as chief experience executive and strategist, leading data scientists, developers, linguists and customer experience consultants to help create artificial intelligence (AI), machine learning and natural language understanding products to define a real-time voice of the customer. Prior to working at Decooda, Oyler held customer experience roles with FLEETCOR Technologies and State Farm.

Oyler earned a doctorate in organizational behavior and statistics from Virginia Tech and a master’s in marketing from the University of Arkansas.

NWPS Announces Rebranding After Numerous Acquisitions

Northwest Plan Services Inc. has announced its rebranding to NWPS after several acquisitions across the country in the retirement plan services industry over the past five years.

Tim Wulfekuhle, president and CEO, explains, “It was time to remove the regional reference in our name to reflect our national presence without erasing our history. The acquisition of multiple firms and new clients across time zones has truly made us a national firm. We intend to take advantage of this to keep evolving our services to meet plan sponsor needs.”

Headquartered in Seattle, NWPS began expanding in the spring of 2015 with Maryland-based CDM Retirement Consultants Inc.; Trautman, Maher & Associates in the Seattle area was acquired in the summer of 2016. Kaufmann and Goble Associates, an industry leader in multi-employer trusts in San Jose, California, came aboard in August 2018. Venuti and Associates was the latest acquisition in March, further adding to the firm’s actuarial and consulting expertise.

Mercer Appoints Global Head of Private Debt

Mercer has appointed David Scopelliti as global head of Private Debt.

In his new role, Scopelliti will oversee Mercer’s research, advice on and implementation of private debt strategies globally. Reporting to Mercer’s global chief investment officer (CIO) for Alternatives, Bill Muysken, Scopelliti joins as partner and will be based in Mercer’s Norwalk, Connecticut, office. 

Scopelliti has over 30 years of experience in a variety of senior private debt and private equity roles, including serving as CEO of Alcentra Capital Corp. Prior to this, he was a partner at GarMark Partners, a middle market debt and equity firm. He was also head of private equity and principal investment officer at the state of Connecticut Retirement Plans and Trust Funds and group head of Principal Investments at ING Capital. Scopelliti is also a FINRA registered representative and member of the National Association of Corporate Directors. 

Commenting on his appointment Scopelliti says, “Mercer has continued to grow and innovate in the private debt and alternative investing market, providing differentiated advice and investment solutions to meet client and market challenges. Many professional investors are now recognizing the potential offered by alternative investments, and Mercer has the ability to provide a tailored approach whilst keeping clients informed along the way. I’m thrilled to be joining the team and look forward to driving its continued growth.”

Muysken comments, “We are delighted to have David join us at such an exciting time for our private debt business. We continue to see increased demand from investors to help them reduce complexity in the current climate and improve their outcomes. David brings a wealth of experience in alternative investing, ESG [environmental, social and governance] and stewardship of institutional capital to role. Under his leadership, we feel we are even more strongly positioned to be a leading global partner to clients seeking specialized alternatives expertise and advice. Our ultimate aim is to help our clients by delivering insightful research, customized advice and implemented solutions that help them achieve their desired outcomes.”

Compliance August 7, 2020

Court Clears ‘Actuarial Equivalence’ Lawsuit for Discovery

Several interim rulings have been handed down in the case, which asks some key questions about the meaning of the term ‘actuarial equivalence’ in the context of ERISA litigation.

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The U.S. District Court for the District of Massachusetts has issued a new ruling in the complex case known as Belknap v. Partners Healthcare System.

The new ruling sides with the plaintiffs in the case and rejects the defense’s motion to dismiss, based on the court’s determination that there remains “no clear answer,” at least at this stage of the proceeding, as to what is necessary for two retirement benefit forms being considered here to be “actuarial equivalents,” as is required by the Employee Retirement Income Security Act (ERISA).

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The ruling notes that ERISA does not explicitly define the term “actuarial equivalent,” and the various federal courts to consider the question have yet to agree on a definition. For that reason and others, the court says, it would be inappropriate to reject the plaintiffs’ claims ahead of discovery and further legal consideration.

A previous ruling was handed down in the case in January, when the parties were given an opportunity to submit supplemental briefings as to the meaning of “actuarial equivalent” under the relevant statutes.

As the first district court ruling explains, ERISA and other federal statues require that different types of qualified pension benefits offered to a single plan’s population must be “actuarially equivalent.” This is to say that if a participant chooses one type of annuity benefit versus another offered in the plan—in this case a joint and survivor annuity (JSA) versus a single life annuity (SLA)—the present theoretical value of each benefit choice must be equal.

“Actuarial equivalence may be a term of art, but the statute does not define it, nor is its meaning clear on this record,” the first decision states. “And under at least one plausible definition of actuarial equivalence, the way in which [plaintiff’s] retirement benefits are valued could violate that requirement.”

It now appears that the defense’s supplemental briefings were not convincing enough for the court to throw out the lawsuit upon preliminary review of the alleged facts. Technically, this new ruling comes after the parties jointly proposed that the plaintiff would respond to the issues raised in the court’s first ruling by filing an amended complaint, to which the defense could respond. On March 3, the plaintiffs filed an amended complaint that named several additional defendants. The defense, in turn, moved to dismiss the amended complaint under Rule 12(b)(6) for failure to state a claim. This new ruling rejects that motion.

At the core of this lawsuit sits the fact there is no basis in the actual text of ERISA to require that an “actuarial equivalent” be based on reasonable assumptions. As the court’s two rulings explain, this is because ERISA Section 1054(c)(3) contains no such reasonableness requirement, while other provisions in ERISA expressly do, which indicates that this omission by Congress in writing the law was deliberate. Nonetheless, the court observes, ERISA Section 1054(c)(3) still requires an early retirement benefit to be the “actuarial equivalent” of the normal retirement benefit under a plan.

“ERISA Section 1054(c)(3) does require that the two benefit forms be ‘actuarial equivalents.’ That term must mean something,” the new ruling states. “But despite using it, ERISA does not further define actuarial equivalence. Presumably, then, Congress intended that term of art to have its established meaning. Thus, the question becomes ascertaining the ‘established meaning’ of ‘actuarial equivalence.’”

The new ruling steps through various proposed definitions of these terms as argued by the defense, but the court finds none of them sufficiently persuasive to halt the lawsuit at this early stage.

“There is no clear answer, at least at this stage of the proceeding, as to what is necessary for two retirement benefit forms to be actuarial equivalents as required by ERISA,” the ruling concludes. “ERISA does not define that term, and courts have yet to agree on a definition. Nor is it clear, at least on this record, whether actuarial equivalence is in fact a term of art, or how actuaries themselves would interpret the term. It may be that expert testimony on the topic is required to resolve the issue. In any event, the court cannot resolve the issue, on this record, on a motion to dismiss.”

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