Independent BDs Tell SIPC to Drop Excessive Fees Levied Post Madoff

Post-Madoff, “SIPC assessments have skyrocketed, hitting small firms particularly hard, especially the 1,000 or so firms whose revenues are primarily derived from services not covered by SIPC, such as placement agents, consultative mergers and acquisitions or private placement firms,” Roth told AdvisorOne on Wednesday. SIPC's charter is to intervene in the event a firm goes bankrupt and securities or other assets are missing, Roth continues, so “it’s a stretch to assess fees to firms that operate under contract, have no customers, hold no assets.".

Roth, who’s CEO of Keystone Capital Corp. in San Diego, says her firm’s annual SIPC fee went from $150 annually to a whopping $3,000. While Roth says she believes NAIBD’s efforts to have SIPC drop the fee will likely be “successful,” if they aren’t, she says, “I will take this issue to Congress.”