Another broker-dealer has decided to continue supporting both fee-based and commission-based retirement accounts.
The latest is Cambridge Investment Group, Inc., which says it is in the final stages of building out the processes and tools “designed to provide each independent financial advisor the ability to customize their own fiduciary plan based on their investing clients, book of business, and the business model they have chosen for their independent firm.” Cambridge says it is taking these actions to continue to provide flexibility for independent advisors while meeting regulatory requirements.
According to a press release, Cambridge says it intends to apply the Best Interest Contract provision announced by the DOL last April for certain commission-based accounts, and discretionary advisory business will be supported through level fee platforms. “While commission-based retirement accounts will be acceptable at Cambridge, the commissions must be levelized by each predefined investment category so that all similar investment options have the same compensation structure,” according to the firm.
Four Business Paths
Cambridge has identified four business paths advisors can choose from:
- Non-retirement investing client
- Small accounts
- Best Interest Contract
- Level fee fiduciary
According to the announcement, Cambridge’s Fiduciary Services team is creating “Advisor Fiduciary Plans” to give each advisor insight into the accounts effected by the new DOL rule, as well as outlining the steps the advisor needs to take to be in full compliance with the new DOL rule, especially the applicability deadline of April 10, 2017 and the full implementation deadline of Jan. 1, 2018.
Cambridge Investment Group, Inc. is a privately-controlled firm with multiple broker-dealers and RIAs, including:
- Cambridge Investment Research Advisors, Inc., a large corporate RIA;
- Continuity Partners Group, LLC, a special purpose broker-dealer and registered investment advisor; and
- Cambridge Investment Research, Inc., an independent broker-dealer, member FINRA/SIPC, that supports over 3,000 independent financial professionals nationwide.
Cambridge is the latest firm to announce its intention to continue supporting commission-based fees for retirement accounts, joining Cetera Financial, Raymond James, Morgan Stanley and Ameriprise. Meanwhile, Commonwealth Financial Network and Merrill Lynch have decided to move away from offering commission-based products in the retirement accounts they serve.