SOA vs CAS and AAA Timeline

SOA vs. CAS and AAATimeline of actions since 2011

October 2011: It BeginsAnnouncement by Brad Smith at SOA annual meeting in his Presidential Speech:

“There is absolutely no need for three separate professional organizations, the SOA, the CAS and the AAA, to exist. They need to consolidate into one efficient, effective organization.”

Surprise!In Smith’s 2010 Presidential Elect Material, need for merger not mentioned:https://www.soa.org/Leadership/Elections/Board-Candidates/2010/Bradley-M--Smith,-FSA,-MAAA.aspxhttps://www.soa.org/BoardCandidates/BoardCandidateLandingPage.aspx?page=Issues&id=4294968270

Surprise to Board, tooFrom Smith's 2011 SOA Presidential Speech:

“Although the SOA Board has not expressed any view on the matter, I have had significant conversations with a number of our Board Members including all of the Presidential officers, who are fully supportive of this direction.”

Nov 2011: CAS ResponseFrom CAS Board :

“The CAS is the only non-nation specific actuarial organization exclusively focused on property-casualty risks, and our members find this of value. Our members have made it clear, and the CAS Board agrees, that they do not see benefits in consolidation with other actuarial organizations. The CAS has been, and continues to be, strongly in favor of cooperative efforts with other organizations, including efforts to address the concerns raised in the SOA President’s speech.”

Key Aspects of Response● CAS Board asked for member response

○ Blog comments, online poll, in-depth survey of CAS Member Advisory Panel

● CAS noted areas of cooperation ○ Joint preliminary exams○ Promoting profession (example: Be an Actuary site)○ Joint Risk Management Section○ Work on future joint action, such as disciplinary

process

March 2012: SOA GI TrackDecision by SOA Board at March 2012 meeting

‘The Board approved the creation of an educational track in general (property-casualty)

insurance, ensuring that the SOA is providing options covering all actuarial disciplines to earning

the Fellow of the Society of Actuaries (FSA) designation. "The Board approved the creation of

the new specialty track after determining that including general insurance education will help

fulfill the strategic vision for the SOA to remain a leading global provider of broad-based actuarial

education," Smith said. The first of the exams and e-learning modules is expected to be made

available to candidates beginning in fall 2013.’

October 2012: PrelimsSOA Board Decides to stop co-sponsorship of preliminary exams

“In October, the Society of Actuaries Board of Directors approved a proposal to end the Joint Preliminary Actuarial Examination Agreement with the Casualty Actuarial Society as of Dec. 31, 2013. Since then, there have been some questions about what this means and why the decision was made.”

Reasons GivenIn a letter from then-SOA-President Tonya Manning, October 2012:

“ In brief, the decision will allow us more control over the evolution of our exam system. ….Being the sole administrator of the preliminary exams will allow us greater flexibility and efficiencies to provide a curriculum and set of exams throughout the pathway (preliminary exams through Fellowship) that meet the needs of the global marketplace.”

Oct 2012: CAS ResponseLetter from then-CAS-President Pat Teufel:

‘The SOA’s action negatively affects one of the most successful, and fundamental, joint activities of the SOA and CAS, and signals a shift by the SOA away from cooperation and collaboration with the other US-based actuarial organizations.

….The CAS participated with the other US-based actuarial organizations in the U.S. Profession-wide Task Force sponsored by the American Academy of Actuaries. That Task Force recommended that “the organizations identify functions (with consideration of antitrust constraints, if any) that can be made more efficient through collaboration or consolidation and proceed accordingly.” While the SOA participated in this Task Force, the actions of its Board are inconsistent with the recommendations made by the Task Force as well as the spirit underlying the creation of the Task Force.’

Mar ‘13: SOA Makes OfferSOA Board Offers SOA membership to CAS members:· It agreed to waive certain examinations and other requirements toward membership in the SOA for persons who have successfully passed or completed substantially equivalent examinations or courses required by the Casualty Actuary Society (CAS) until at least Dec. 31, 2015. Information on the specific waiver requirements will be posted soon on the SOA website in its Education, General Information section.· It also agreed to allow Associates and Fellows of the CAS to become Associates and Fellows of the SOA, subject to certain conditions and policies, until at least Dec. 31, 2015. Information on the specific conditions and policies to apply will be posted on the SOA website shortly.

Sep 27, ‘13: Letter to NAICSOA writes letter to Joint Qualified Actuary Subgroup:

“As you know, the SOA recently began offering a fellowship program in general, or property-casualty insurance – a discipline that was previously served in the U.S. only by the CAS, but globally by other professional societies as well. Competition among these professional organizations is something new and will require broader regulatory recognition to account for this change in the educational marketplace. Therefore, we urge that any guidance provided by the NAIC on the subject of appointed actuary should not be unduly restrictive with regard to membership and should recognize all of the aforementioned organizations.”

Jan 2014: AAA ActsRemoval of SOA Special Board Members on January 15, 2014:

“WHEREAS, in various actions, including in a letter dated September 27, 2013 to the National Association of Insurance Commissioners and a letter dated January 10, 2014 sent to the Academy Board, SOA has asserted that it has commercial and other interests that are adverse to the interests of the Academy; and

WHEREAS, while the Academy does not believe that it engages in commercial conduct in competition with the SOA, the Academy must recognize the assertion of such commercial competition by the SOA; and

WHEREAS, in addition, the SOA letter sent to the Academy Board on January 10, 2014 asserts potential antitrust theories that it may pursue against the Academy; and (cont)”

Jan 2014: AAA Acts (cont)“WHEREAS, the presence of the two Special Directors who are representatives of the SOA precludes the Academy Board from addressing matters that are essential to the governance, operation and purpose of the Academy; and

WHEREAS, in light of the foregoing, the Academy Board has concluded that the presence of the two Special Directors who are representatives of the SOA is no longer helpful to the Academy;

THEREFORE, IT IS RESOLVED THAT, unless and until the conflicts described are resolved to the satisfaction of the Academy Board, the Board shall not fill designated seats with SOA representatives; and

RESOLVED FURTHER, that the two Special Directors from the SOA are hereby removed as Directors.”

Feb 2014: Terry ExplainsLetter from then-AAA-President Tom Terry:

“The actions taken by our Board are a reflection of our deep commitment to our mission and all that we do

in support of this mission to inspire public confidence in our profession. The Academy expects its Board

members to share this mission enthusiastically and unambiguously.

We remain committed to productive relationships with all U.S.-based actuarial associations, including

ASPPA-ACOPA, the CAS, the CCA and the SOA. We have a long history of working well with each of

these associations, and we have always been committed to responsibly working through the occasional

disagreement. The Academy’s first and most important goal, however, is to do what we believe is in the

best interest of the U.S. actuarial profession as a whole and the American public.”

Sep 2014: SOA EmailsThen-SOA-President Freedman sends email to CAS members:

“From: Mark Freedman <[email protected]>

Date: Wed, Sep 17, 2014 at 8:03 AM

Subject: An Invitation from the Society of Actuaries

….

The Society of Actuaries (SOA) is accepting applications from Property/Casualty (or

General Insurance) actuaries who hold the FCAS or ACAS designations to become

SOA members. I am reaching out to you because I believe becoming a Fellow or

Associate in the SOA will benefit you professionally.”

Controversial Line in EmailFrom the email, the following line caused concern:

“By becoming a member of the SOA, you will gain the career flexibility that SOA membership provides — ease of movement from one area of practice to another without replacing credentials.”

Complaints to ABCD 26 Sep ‘14: Terry et. al. make ABCD complaint:

“This is false and misleading, One never has to change or replace credentials to change practice areas.”

Claims violation of Precepts 1, 4, and 11 of Code of Professional Conduct

1 Oct ‘14: Fisher makes ABCD complaint:Claims violation of Precept 1 of Code of Professional Conduct (Annotation 1-4 specifically) with

points: “1) Mr. Freedman knew that use of the CAS directory to solicit CAS members to join the SOA

was unethical and unprofessional. ….2) Mr. Freedman and the SOA acted with deception. ….3) Mr. Freedman's acts reflect adversely on the actuarial profession. …. 4) Misrepresentation.”

[These ABCD complaints were not public until Dec 2014 Mark Freedman lawsuit filed]

Oct ‘14: AAA RespondsEmail sent to AAA members on Oct 3, 2014:

‘In what we understand to be an unsolicited e-mail sent to thousands of property and casualty actuaries credentialed by the CAS, the

SOA stated that “By becoming a member of the SOA, you will gain the career flexibility that SOA membership provides—ease of

movement from one area of practice to another without replacing credentials.”

As it applies to the U.S. Qualification Standards (USQS), we do not believe this statement to be correct. The requirements set forth in

the USQS are fairly explicit about changing practice areas.

….

If, however, the actuary wishes to change practice areas, and does not want to spend years re-earning his or her basic education in

another area of practice, the actuary may change practice areas IF he or she follows the USQS requirements, which are largely based

upon the experience he or she acquires under the review of an actuary qualified in the new practice area.’

Nov 2014: CAS AccusationFrom Letter from then-CAS President Wayne Fisher:

“The last few weeks have been both uplifting and unsettling. As most everyone is aware, the SOA sent a blast marketing email to our members containing inaccurate and misleading information pertaining to the career flexibility afforded by the SOA credential. They did this by accessing our membership directory 8,248 times (yes, that’s right) in order to circumvent the database infrastructure designed to prevent mass downloads of our members’ personal data.This act was certainly unsettling; a peer actuarial organization acting in a way that I believe is clearly unethical and unprofessional. And it was also unsettling in that I believe the vast majority of SOA members would not expect their leaders to be acting this way, but these leaders did so anyway.”

Dec 2014: Lawsuit FiledMark Freedman filed lawsuit re: ABCD Complaints and ProcessInitial complaint can be seen here:

http://www.bakosenterprises.com/FLS.pdf

Academy litigation updates:

http://www.actuary.org/content/member-litigation-updates

CAS notice:

http://casact.org/press/index.cfm?fa=viewArticle&articleID=2762

SOA notice:

https://soa.org/leadership/board-announcements/2015-01-07-member-com.aspx

SOA/CAS Double Members

Based on Actuarialdirectory.org search results, 27 Jan 2015

FSA/FCAS 96

ASA/FCAS 67

FSA/ACAS 28

ASA/ACAS 54

SOA GI exam takers Number Sitting

EXAM Fall 2013 Spring 2014 Fall 2014

GIIRR 11 10 9

GIFREU 1 2

GIADV 4 3

What Did I Miss?Slides compiled by Mary Pat CampbellJanuary 27, 2015Please email me if there is a problem: [email protected]

Also see:http://www.actuarialoutpost.com/actuarial_discussion_forum/showthread.php?t=290157