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Industry Spotlight > Broker Dealers

A Transitions B/D

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What happens if a representative becomes disabled or passes away? “Normally the broker/dealer would retain all commissions, and the surviving spouse or beneficiary would receive nothing,” says Scott Yamamura, Group President, Contemporary Financial Solutions, (CFS), a sister B/D to Mutual Service Corporation in West Palm Beach, Florida.

What’s different about CFS, however is that this B/D, started in 2002, will pay the inactive rep or rep’s spouse, or beneficiary, 50% of the trail commission for as long as the rep’s former clients stay with CFS. This could be an option for reps that don’t sell securities full-time, such as CPAs or insurance agents, or older reps who are contemplating retirement, but whose books may be too small to sell. Think of “a rep that’s aging, and doesn’t want to comply with continuing education–we’ve seen a number of reps that go inactive, and ultimately they get out of the business–this is a way for them to continue to receive some kind of compensation,” Yamamura explains.