Broker Dealer to Affiliate with for Mutual Fund Business Only

[daveshea]

Brand new to the forums, having registered after searching old posts for an answer to my question...

I am a fairly newly licensed rep. I worked in the business about 15 years ago, held a Series 7 and worked as a sales trainer with a large brokerage firm. Obviously that license lapsed a long time ago when I left the business.

I now have started a Medicare advisory business, but also want to sell securities to clients needing help with IRA rollovers, 529s, etc. I obtained a Series 6 and 63 and registered with a firm in California.

I am NOT happy with their compliance and paperwork requirements that I'm having to jump through just to get a mutual fund application approved and sent to a fund company. The straw that might break the camel's back is a large IRA rollover that is being held up in compliance now for a week over a typo on a form and the need to get all new documents from the client, etc. I'm dealing with 35 pages of firm required paperwork just to be able to submit the fund company application to American Funds!

In my opinion, the paperwork requirements aren't reasonable for accounts that will be held at the fund company only.

Right now, I'm small time, just building production, and I don't want to be burdened with a bunch of fees and want to just follow the rules and help my clients.

Can anyone steer me to a reputable firm that won't object to my small status right now, understand that I'm just wanting to do mutual fund stuff right now, and won't charge all kinds of fees...

Frustrated,
-David.

 

[DHK]

I am no longer securities registered, but there are two firms you may want to check out:

https://www.usafinancial.com/

https://questcapital.com/

I don't know their fees or any additional compliance hurdles. I've heard of both firms by reputation only.

Here's a 3rd one if you have enough securities production (something like $20k GDC): www.onesco.com.

The nice thing about them, is that if you are writing for Ohio National, your life insurance production would count towards your GDC production on the investment side.

 

[Golfnut2112]

USA financials paperwork in absolutely insane and you cannot deal direct with fund companies, all mutual funds must be put into a brokerage account. They have a $299 a month tech fee and a $299 premium for E & O. Their marketing support and letting you brand your business is incredible.

Also check out HD Vest they do not have a minimum production requirement. Their tech fee is $95 per month with a 50% discount your first year.

 

[LGilmore]

You'll find most of us here that let our sec. licenses go, just found the paperwork and compliance issues just not worth the hassle.

When I had a 6 hour in my office argument with the compliance officer over giving them ALL my correspondence ( not just security related) I refused. I was not about to give those fools health information emails from any client.

Explaining HIPAA just went over their heads. I had clients with everything with me. I don't share their investment information with their health insurance company and will not share their health information with the BD.

Took them a week to realize I was correct and apologize. I left within the year. It seems to be the trend of BDs those days. Sure it's not too different now.

 

[Norwayguy]

You'll find most of us here that let our sec. licenses go, just found the paperwork and compliance issues just not worth the hassle.

When I had a 6 hour in my office argument with the compliance officer over giving them ALL my correspondence ( not just security related) I refused. I was not about to give those fools health information emails from any client.

Explaining HIPAA just went over their heads. I had clients with everything with me. I don't share their investment information with their health insurance company and will not share their health information with the BD.

Took them a week to realize I was correct and apologize. I left within the year. It seems to be the trend of BDs those days. Sure it's not too different now.

And we can only assume the compliance paperwork has gotten worse.

 

[VolAgent]

35 pages for some mutual funds doesn't sound outlandish at this point. While you may find something better, that may just mean 30 pages instead. I'm pretty sure it was up to about 15 or so when I gave up my Series 6 about 7 years ago.

As has been said, most of us gave up our securities licenses a long time ago due to the time and cost of compliance and paperwork.

 

[eersfan]

Capital Synergy Partners located in Newport Beach, CA.

Capital Synergy Partners - The Driving Force Behind Financial Professionals Since 1998

----------

$299 for E&O, unless that is a monthly premium, is cheap. I pay $1400/year. Where in my home state of WV are you located?

 

[daveshea]

I really appreciate the feedback so far, and welcome more of it!

I don't want to mention the name of the firm I am with publicly for fear of any repercussions, but basically here's my deal:

I've got a Series 6 license - I started work with a captive P&C insurer but left very early on due to dissatisfaction with their agent training program. Basically got licensed and saw what was really going on having spent a lot of money on all of it. Left the insurer and their broker dealer behind.

I now sell Medicare Supplements and Medicare Advantage plans as my primary business. The securities side of things is IRA rollovers or 529s for kids and grandkids, etc. This isn't complex investment strategy.

I affiliated with a new broker dealer that I thought was meant for small people like me. Everything I do is directly with the fund companies, but this firm requires all of the normal account opening paperwork you'd need for a normal brokerage account for compliance purposes.

However, prospectus receipts, citizenship paperwork, investment switch paperwork, FINRA fee analyzer signed by the client, breakpoint worksheets, etc, etc, etc....there is so much more.

I feel that is excessive. Just today I finally got an IRA rollover account approved by compliance. The paperwork has been at the home office for 10 days I believe, with compliance for 7. That's unacceptable. Trying to call to get an answer gets nothing but voicemail and emails are returned 2 days later, if at all.

All that, and I get charged $95/month for the privilege of it all regardless of monthly production.

I simply want to find a firm that will let me place my modest securities business, earn something on it, help my clients and not be 1: "nickel and dimed" with fees, and 2: have the minimal support I require delivered in a timely fashion, since after all, I'm paying for it!

I guess that's me venting, but there you go...

I welcome additional feedback.

 

[eersfan]

I really appreciate the feedback so far, and welcome more of it!

I don't want to mention the name of the firm I am with publicly for fear of any repercussions, but basically here's my deal:

I've got a Series 6 license - I started work with a captive P&C insurer but left very early on due to dissatisfaction with their agent training program. Basically got licensed and saw what was really going on having spent a lot of money on all of it. Left the insurer and their broker dealer behind.

I now sell Medicare Supplements and Medicare Advantage plans as my primary business. The securities side of things is IRA rollovers or 529s for kids and grandkids, etc. This isn't complex investment strategy.

I affiliated with a new broker dealer that I thought was meant for small people like me. Everything I do is directly with the fund companies, but this firm requires all of the normal account opening paperwork you'd need for a normal brokerage account for compliance purposes.

However, prospectus receipts, citizenship paperwork, investment switch paperwork, FINRA fee analyzer signed by the client, breakpoint worksheets, etc, etc, etc....there is so much more.

I feel that is excessive. Just today I finally got an IRA rollover account approved by compliance. The paperwork has been at the home office for 10 days I believe, with compliance for 7. That's unacceptable. Trying to call to get an answer gets nothing but voicemail and emails are returned 2 days later, if at all.

All that, and I get charged $95/month for the privilege of it all regardless of monthly production.

I simply want to find a firm that will let me place my modest securities business, earn something on it, help my clients and not be 1: "nickel and dimed" with fees, and 2: have the minimal support I require delivered in a timely fashion, since after all, I'm paying for it!

I guess that's me venting, but there you go...

I welcome additional feedback.

Send me a private message and we can discuss if you're interested.

 

[ktmorgan]

Sorry man, but you're likely to find that most B/D's suck total ass these days. FINRA, DOL, Dodd-Frank, KYC, SAR...etc. All the new regs put in after the last two market meltdowns have made being a small RRep not a fun way to make a living. It's really not the B/D's fault. The regulators are nasty with their audits so Compliance is a really big deal. That's one reason all the Insurance Cos are dumping their B/D's...no money in it after their cost of doing business. Plus, Int Rates are persistently low.

With the likes of LPL, Cetera, Kestrel...etc, buying up everything in sight it will get a little better because of Economies of Scale. But they're still a pain in the ass to deal with. Plus, your E&O+ other annual fess are going be $4-5k+ with the big Indy's. But you have a great Tech Stack to work with. And they will be very professional and as fast as they can be getting paperwork done and at least picking up the phone for you.

You can dump your FINRA Reg and go NASAA Series 65 IAR. Be fee only. Life is a lot better on this side of the table. The "Transaction-Based" business model is dead or dying. That's why even Merrill is in constant recruiting mode.

There are many national RIA's working with small guys who are very friendly to Insurance Producers. Some have mins, some don't you just have to look around. I can refer you to some if you want to go that route. I don't recruit so I get nothing out of it.

I really appreciate the feedback so far, and welcome more of it!

I don't want to mention the name of the firm I am with publicly for fear of any repercussions, but basically here's my deal:

I've got a Series 6 license - I started work with a captive P&C insurer but left very early on due to dissatisfaction with their agent training program. Basically got licensed and saw what was really going on having spent a lot of money on all of it. Left the insurer and their broker dealer behind.

I now sell Medicare Supplements and Medicare Advantage plans as my primary business. The securities side of things is IRA rollovers or 529s for kids and grandkids, etc. This isn't complex investment strategy.

I affiliated with a new broker dealer that I thought was meant for small people like me. Everything I do is directly with the fund companies, but this firm requires all of the normal account opening paperwork you'd need for a normal brokerage account for compliance purposes.

However, prospectus receipts, citizenship paperwork, investment switch paperwork, FINRA fee analyzer signed by the client, breakpoint worksheets, etc, etc, etc....there is so much more.

I feel that is excessive. Just today I finally got an IRA rollover account approved by compliance. The paperwork has been at the home office for 10 days I believe, with compliance for 7. That's unacceptable. Trying to call to get an answer gets nothing but voicemail and emails are returned 2 days later, if at all.

All that, and I get charged $95/month for the privilege of it all regardless of monthly production.

I simply want to find a firm that will let me place my modest securities business, earn something on it, help my clients and not be 1: "nickel and dimed" with fees, and 2: have the minimal support I require delivered in a timely fashion, since after all, I'm paying for it!

I guess that's me venting, but there you go...

I welcome additional feedback.