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Only do if you're in it for the public servants. Do not do if you see it as an income opportunity.
I agree with FA1. Definitely a risk of self dealing accusations and I could see your BD coming down extremely hard on you. The liability you'll create for them, even if you don't work as an FA for any of the pensioners, is gigantic (basically unlimited). All it takes is one person questioning your perspective to cause catastrophe of gigantic LOC accusations.
What do you mean ^ ?
If anything goes wrong (including unavoidable systemic risk) and someone files a complaint, it's a PITA for everyone. Lost Opportunity Cost accusations for the fund doing X instead of Y and the compounding effects thereafter.
On this same note...what about the 457 plans for Police/Firemen? Have any of you been advisor on those plans (similar to 401k)? I was actually thinking of doing this.