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In the News

Fee Changes May Mean More Fee-Based Accounts

00:00 10 July in In the News by rafferty

by Daisey Maxey and featured in Dow Jones Newswire
July, 2010:

(New York) – A proposal by regulators to limit and shed more light on mutual-fund distribution charges won’t, for the most part, affect brokers’ overall compensation but could encourage more fee-based advisory business.

Even if brokers were to see the proposal as a threat, they aren’t likely to raise many complaints.

The changes, proposed by the Securities and Exchange Commission this week, would restrict funds’ ongoing sales charges to the highest fee charged by the fund for shares that have no ongoing sales charge. For example, if one share class of a fund charges a 4% front-end sales charge, another class couldn’t charge more than 4% in total to investors over time.

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‘Marked’ Advisers Finding It Harder To Move

00:00 01 July in In the News by rafferty

by Daisy Maxey and featured in Dow Jones Newswire
July, 2010:

NEW YORK (Dow Jones) – Financial advisers with multiple blemishes on their records are finding it tougher to move from one broker-dealer to another these days.

Not all that long ago, the new firm might look past an adviser’s “marks” (for, say, selling an unsuitable investment to a client) if they brought a healthy book of business and a talent for recruiting clients. But in the post-crisis world of both heightened litigation and increased regulatory scrutiny, that isn’t happening as often.

Mindy Diamond, president of Chester, N.J.-based search firm Diamond Consultants, says, “We’re living in a much more hyper-vigilant compliance culture where the appetite for advisers with marks (on their records) is much less than it has ever been before.”

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You Never Let a Crisis Go to Waste

00:00 01 July in In the News by rafferty

by John Sullivan and featured in Boomer Market Advisor
July, 2010:

It’s good to be Jon Henschen. The founder and president of Henschen and Associates, a broker/dealer recruiting firm in the independent channel, is having his best year ever – even more so than 2009.

“I’ve been placing a of lot high-dollar groups looking to make a change with new firms,” he says. “With certain broker/dealers completely dissolving and others in regulatory trouble, it shows little sign of slowing.”

Little sign of slowing. That’s the key phrase. While last year is considered the high-water mark for recruitment at many broker/dealers, the flux is far from over. Initial public offerings; firm dissolutions; legislative and regulatory action; name changes. As one salty Obama administration official put it,

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