The Financial Services Industry plays an important role in helping individual investors access capital markets and navigate a complex landscape of financial products and investments. There are many rules and regulations that are designed to protect investors when it comes to providing financial advice. It is important for consumers to know exactly how this industry operates so they can make informed decisions about what advise they should accept and who they choose to accept it from.
There are two major regulatory bodies that oversee the financial services industry, The Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA). These governing bodies oversee Broker/Dealers and Registered Investments Advisers who in turn supervise the FINRA licensed and/or SEC registered financial advisors who affiliate with them.
This is where The Certus Financial Group (TCFG) fits in. They are a FINRA member firm and an SEC Registered Investment Adviser much like a number of other Broker/Dealers, big and small, throughout the country.
As a FINRA Series 7 and Series 66 licensed financial advisor I have partnered with TCFG in order to offer securities and investment advice to my clients. Dave Baldwin Financial, the business name by which I operate is Independent of TCFG and I am not not an employee or captive advisor of TCFG. They act as my back office to process client transactions, record and collect fees, commissions, and payments from clients, and supervise my communications and advisory activity to ensure strict compliance with the rules, regulations, and professional standards I am held to as a licensed financial advisor.
It is important to draw a distinction between financial advisors who operate as independent contractors and those who act as employees of their Broker/Dealer firms. While both independent contractors and employees are supervised for regulatory compliance, financial advisors who are employed by their Broker/Dealer may be influenced by a duty of loyalty or incentivized by their employer to sell certain products or meet revenue goals as a term of their employment. This influence may affect the quality of the advice you receive.
Aside from regulatory supervision the other important factor to understand is the custody of assets. Where is the money held? As you can imagine, much like financial advise, the custody of assets and the businesses that perform that function are heavily regulated, as they should be. However, the cost to perform that function can be somewhat prohibitive unless it is done in large enough scale. Some Broker/Dealers (especially those with employees focused on generating revenue for the firm) can afford to be their own custodian, others (most independent financial advisory firms) outsource that to one of three major platforms, Pershing, Fidelity, or Charles Schwab.
Pershing, LLC, a subsidiary of BNY Mellon, is the platform that Dave Baldwin Financial and TCFG have chosen to act as custodian for client assets. Pershing has over $2 trillion in assets on their platform (as of Dec 2020) and serve over 100,000 financial advisors through a variety of large and small Broker/Dealers around the country.
To sum it all up, Dave Baldwin, as an independent financial advisor, provides Financial planning and investment management services through TCFG Wealth Management, LLC (Member FINRA/SIPC), and TCFG Investment Advisory LLC (an SEC Registered Investment Adviser) on behalf of his clients in accounts held and maintained by Pershing, LLC.