Welcome to Financial Advisor IQ

LPL Breakaway Independent Financial Partners Receives Finra Nod for New Broker-Dealer

By Mrinalini Krishna February 4, 2019

Hybrid RIA Independent Financial Partners has received Finra approval to launch its broker-dealer IFP Securities, LLC, the firm said in a press release.

IFP, which previously served as a hybrid RIA and OSJ with LPL Financial, chose to separate from LPL in April last year.

IFP filed for a new member application with the self-regulator in July 2018 and received the approval from the industry organization after “approximately 6 months of collaboration with Finra, which included an in-person interview between IFP’s executive team and Finra representatives”, the statement read.

“This is a momentous occasion for IFP, since we played with the idea of starting our own broker-dealer over 4 years ago,” says IFP’s CEO Bill Hamm in the release.

IFP hopes to launch its broker-dealer in April 2018. Until then the firm says it is working on building its platform with Pershing, its chosen partner for clearing and one of its five custodians, getting ready its proprietary advisor interface, Advisor[X], and preparing its advisors for transition.

IFP’s separation from LPL has been the source of public disagreement between the two firms, especially involving the movement of advisors. The breakaway even found mention in LPL’s earnings call on Thursday, where the LPL said it would retain 75% of the assets of IFP advisors.

Speaking with FA-IQ in January, IFP COO Chris Hamm said he expects to have 225-250 advisors at the time of the broker-dealer launch and end the year with over 300 advisors.

Chris Hamm

IFP will offer equity to advisors who join its broker-dealer, adding up to 15% of the firm’s equity and revealed its payout grid late January.

“We’ve got competitors trying to recruit our people, doubters and skeptics telling us all the reasons this won’t work, and so on. Soon, though, people are going to see what we’ve been up to,” COO Hamm says according to the release.