Broker Dealer With No Minimum Production

We offer self-managed advisory plans for your clients as well as outside asset management, and asset allocation models to assist you in securities selection. Under $50, 000 – up to 70%. Can I maintain an independent practice on only $100,000 of revenue. 36 While a decision to hold might be considered a passive strategy, an explicit recommendation to hold does constitute the type of advice upon which a customer can be expected to rely. Their US operations are in Minneapolis, Minnesota. See Pryor, McClendon, Counts & Co., Exchange Act Rel.

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At Lombard, you have direct access to senior management and the ability to run your practice in a unique way that works for you and your clients. It has become necessary for us to have a minimum production volume to make it worthwhile for the Rep and the broker/dealer to cover their necessary costs. Where, for example, a registered representative makes a recommendation to purchase a security to a potential investor, the suitability rule would apply to the recommendation if that individual executes the transaction through the broker-dealer with which the registered representative is associated or the broker-dealer receives or will receive, directly or indirectly, compensation as a result of the recommended transaction. These clearing companies generally position themselves in one of three basic forms: as either full-service, discount or independent firms. The firm strongly retains its stock and bond culture from its founding and caters to both new and old-school brokers and advisors. 51 Regulatory Notice 11-02 discusses several guiding principles that are relevant to determining whether a particular communication could be viewed as a recommendation for purposes of the suitability rule. We believe the client should have the information they deserve and what you would want if you were buying. The new rule, for example, does not apply to implicit recommendations to hold a security or securities. Other alternatives such as venture capital, private placement offerings, and overseas holdings are also available to clients who qualify. That is about almost $3-4, 000 a year. From our proprietary Blue Diamond Plus platform to our CRM interface and paperless workflow environment, you will have every tool you need to manage your entire book of business — and scale your book without limits. Frequently Asked Questions. It's a very simple business model and yet a very effective one. 64 Factors such as turnover rate, 65 cost-to-equity ratio, 66 and use of in-and-out trading 67 in a customer's account may provide a basis for finding that the activity at issue was excessive. 83 FINRA stated that a broker-dealer may conclude in some cases that a customer is not capable of making independent investment decisions in general.

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That's very doable, especially if you don't have hundreds and hundreds of clients that make up that revenue. The new rule does not change the longstanding application of the suitability rule on a recommendation-by-recommendation basis. See Richard G. Cody, Exchange Act Rel. 11 Regulatory Notice 08-35, at 2 (stating that direct participation programs (DPPs) and unlisted real estate investment trusts (REITs) are referred to as "investment programs"). 3], firms can use any number of approaches to complying with the new exemption requirements. The approach we take is educational, and we try to be efficient and thorough. Once you are cleared it takes us only about two days to get you in our system. Facts About Independent Broker-Dealers. See SEA Rule 17a-3(a)(17)(i)(D). The institutional-customer exemption does not apply to reasonable-basis and quantitative suitability.

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Section 201(a) of the Jumpstart Our Business Startups Act (JOBS Act) 6 directs the SEC to amend Rule 506 of Regulation D under the Securities Act of 1933 to eliminate the prohibition on general solicitations to the extent that all purchasers are accredited investors. Note: With this guidance, FINRA attempts to present information in a format that is easily understandable. We do not tell you what to buy or sell, how much to buy or sell, or when to buy or sell it. Why Pilot Financial Is The Right Choice. We can add other states if the addition makes good business sense. 55 Accordingly, broker-dealers should assess whether allocation recommendations involving certain types of sub-categories of broader market sectors or even more limited groupings are so specific or narrow that they constitute recommendations of particular securities. In general, an associated person may rely on a firm's fair and balanced explanation of the potential risks and rewards of a product. 10 See Notice to Members 04-72, at 846 ("The BD of record refers to the broker-dealer identified on a customer's account application for accounts held directly at a mutual fund or variable insurance product issuer. Again, we view your business as independent and give you choices that fit your situation. In relation to a customer affirmatively indicating the intention to exercise independent judgment, negative consent will not suffice, but the affirmative indication does not necessarily have to be in writing. Quantitative suitability requires a broker who has actual or de facto control 63 over a customer account to have a reasonable basis for believing that, in light of the customer's investment profile, a series of recommended transactions, even if suitable when viewed in isolation, are not excessive and unsuitable for the customer. Broker dealer with no minimum production i.g. You may have your own RIA if you prefer, and we will do the monitoring and compliance suitability review that is required. In the case of a trust held in a brokerage account, for instance, the firm should consider the trustee's investment experience with, and knowledge of, various investments and investment strategies. 91 Firms are reminded, however, that copies of all communications relating to their business as such and memoranda of brokerage orders are required to be preserved for three years.

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However, the fact that a customer initially needed help understanding a potential investment or investment strategy need not necessarily imply that the customer did not ultimately develop an understanding. We also have custodial relationships with Pershing Advisor Solutions, Fidelity Institutional Wealth Services, and TD Ameritrade Institutional for advisors with assets already on those platforms. Broker-dealers with no minimum production. A broker-dealer may use a risk-based approach to supervising its registered representatives' recommendations of investment strategies with both a security and non-security component. I will use the example of $100, 000 of gross revenue. A firm may use a risk-based approach to evidencing compliance with the suitability rule.

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11 (1992) (stating that transactions a broker effects for a discretionary account are implicitly recommended). If you're ready to join a firm that allows you to experience true Independence and offers no-nonsense fees, while giving you higher take-home pay and "common sense" compliance, we'd love to hear from you! We offer VA sales directly through Lombard Agency, a subsidiary of Lombard Securities. Broker dealer with no minimum production. A suitability analysis of a particular recommendation and consideration of a customer's overall investment portfolio, however, are not mutually exclusive concepts.

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The significance of specific types of customer information will depend on the facts and circumstances of the particular case. What is the scope of the safe-harbor provision in Rule 2111. Just call, and we will schedule a time to give you an online demo. Neither financial professionals, nor the clients they represent, should feel restricted to traditional marketable securities such as stocks, bonds, and mutual funds. We offer the high-touch, intimate feel of a boutique broker-dealer, but also offer products, services, and technology that rival the industry's largest firms. So that's worked out well, and he got money for his practice and lived happily ever after hopefully. 40 The "investment strategy" language would apply to recommendations to customers to invest in more specific types of securities, such as high dividend companies or the "Dogs of the Dow, " 41 or in a market sector, regardless of whether the recommendations identify particular securities. There are other programs such as Laser App, RIA services provided by our clearing firm, which you may wish to investigate. If a firm has a $100, 000 minimum and you think you can do $120, 000, I would recommend looking elsewhere, because otherwise you are going to run into the same problem that people have run into at employee firms. 5K minus $20, 000 expenses so you're down to $20, 000 to $25, 000 income range. An explicit recommendation to hold is tantamount to a "call to action" in the sense of a suggestion that the customer stay the course with the investment. Payout is based on verified production and percentages, includes both security production and brokered insurance commissions -- which gives you an edge over what most of our competitors pay. Reports: Position and tax lot reporting, Gains losses, estivmated income, performance, portfolio snapshot, etc.

Broker Dealer With No Minimum Production

Notice 12-55 (FAQ 10(b)]. At other firms, advisors are often treated as numbers. Our focus is on the Financial Planner's need, and we want you to have all the tools to do an outstanding job for your clients. The term also would capture an explicit recommendation to hold a security or securities. Integrated professional level quotes and news package provided by Thompson Reuters. Lombard is an introducing broker/dealer and clears its brokerage and advisory business through First Clearing officially known as Wells Fargo Clearing Services. In all cases, the suitability rule applies to recommendations, but the extent to which a firm needs to evidence suitability generally depends on the complexity of the security or strategy in structure and performance and/or the risks involved. This position is consistent with requirements under the previous suitability rule. So the main expenses you would incur would be for the home office supervision; it's about $5, 000 a year. For purposes of using a risk-based approach to documenting compliance with suitability obligations, what types of recommendations does FINRA generally consider complex or potentially risky? 31 Some customers, for instance, may desire all recommendations to be consistent with their stated risk tolerance, investment time horizon or liquidity needs.

LEXIS 13, at *12 (NAC Aug. 9, 2004) ("[A] broker's recommendations must serve his client's best interests[, ]" and the "test for whether a broker's recommendation[s are] suitable is not whether the client acquiesced in them, but whether the broker's recommendations were consistent with the client's financial situation and needs. Where a broker did not recommend the original purchase of a security but explicitly recommends that the customer subsequently hold that security, the new suitability rule would apply. Each firm has a general obligation to evidence compliance with applicable FINRA rules. As smartsation is large and complex, please call Curt Fox at 410-342-1300 to arrange a demo. FINRA is aware that some firms currently ask customers for relevant information without using the exact rule terminology or separately designating factors (e. g., investment objectives that include a risk-tolerance component that is not separately labeled as such).

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