What You Need to Know
- Three firms have been testing the program since 2021, Private Client Group President Scott Curtis tells ThinkAdvisor.
- The corporate RIA structure could appeal to advisors who want to ditch their FINRA registration but don't want to set up an RIA of their own.
- Raymond James handles cybersecurity and compliance chores for advisors who join the corporate RIA.
The new affiliation option for independent financial advisors that Raymond James announced last week was under consideration for a while before its launch, especially after the firm saw a similar option work for rivals including Commonwealth, Scott Curtis, president of the Private Client Group at Raymond James, told ThinkAdvisor on Tuesday at its Elevate national conference in Nashville, Tennessee.
The company’s new corporate registered investment advisor model for investment advisor representatives, or IARs, who run fee-only practices was launched with three offices in 2021, but “we wanted to make sure, if there were any bugs, that we got the bugs worked out before we announced it more broadly,” he said during a media briefing.
Competitors had already started offering an option like this; Curtis pointed to Commonwealth as an example of a firm that’s had “great success with it.”
This was “something we talked about for a while” before launching it, he told ThinkAdvisor. There were a small number of advisors who had already expressed interest in it and they “raised their hand” and basically said, “if you need a pilot or you need a test case, we’re happy to do it,” he recalled.
“They’ve been great partners,” he said. “They’ve been appropriately patient and letting us know the tweaks that we need to make before we announced it more broadly.”
No additional offices have been added since last week’s announcement, Curtis said, as it was not communicated to the firm’s advisors before the launch.