About - History

Veterans of the insurance and financial services business, Jeffrey S. Kopitz and Steven R. McCarty saw unethical advisors preying on consumers, especially America's seniors. Worse, they realized that consumers had no practical way to protect themselves against unethical or criminal advisors. Was the advisor who he or she claimed to be? Did the advisor have a long history of disciplinary actions and breaches of fiduciary responsibility? Had the advisor ever been charged with or convicted of a felony? Consumers had no way to answer such questions on a convenient and cost-effective basis.

Granted, consumers had ways to investigate a prospective advisor. They could check with their Better Business Bureau. They could verify an insurance agent was licensed with a state insurance department. And they could verify a securities representative or investment product was properly registered with the National Association of Securities Dealers (NASD). But all of these approaches had flaws. Yet doing a thorough background check was crucial in these times of record insurance and investment fraud.

To remedy these problems, McCarty and Kopitz formed the National Verification Agency, in 2001.

Its mission was to help consumers verify the professional licensing and continuing education status of their insurance and financial advisors. By dealing with an approved member, consumers could be sure their advisor was properly licensed and current with their continuing education. But this was just one piece of the ethics puzzle. Two years later, NVA added criminal background checks-first covering the advisor's current state and then later any state in which the advisor lived or worked over the prior seven years.

In addition to giving consumers more confidence in their advisors, the Agency began to provide advisors with tools and services to communicate their professional ethics to clients. To better reflect this broader business model, it adopted a new name in 2003—the National Ethics Bureau—and a new mission: to become a one-stop ethics resource for insurance and financial services consumers and advisors.

Over the last several years, the Bureau has continued to refine its background check system, while augmenting the services it provides to consumers and advisors.

Enhancements include:

• The addition of a national call center for consumers to verify the NEB approval status of their advisor.
• The creation of a professional profile for consumers to learn more about their advisor's background.
• The development of our "Eye on Ethics" and "Ethics in Action" awards, recognition programs for financial services organizations and advisors.
• The compilation of regulatory contact information for consumers who want to do their own advisor due diligence.
• The introduction of a sponsorship program, in which financial marketing organizations and product companies can promote ethical business practices to their affiliated advisors.
• The development of a proprietary database of advisors that have violated client trust in the past.
• The creation of educational materials and publications that help consumers protect themselves against insurance and investment fraud.
• The publication of the Eye on Ethics newsletter to educate and motivate advisors on how to build a successful business using ethical best practices.
• The publication of a Red Flag Reminder newsletter to help advisors address compliance issues in their business.
• The formation of a strategic partnership with SuccessCE to provide continuing education courses to NEA members.
• The launch of an NEB media campaign service, in partnership with AdvisorPR, a financial services PR firm.
• Expanding membership eligibility for real estate agents and brokers, mortgage lenders, and accountants.
• The sponsorship of Preferred Risk E&O Insurance, an innovative professional liability product designed especially for low-risk financial professionals.

In 2010, NEB continued to evolve by expanding its product and services lineup, by adding new types of E&O insurance and offering product/services discounts as a membership benefit.