Eight rules for changing dealers

You’ve had it with Your dealer. It’s time to move to one with better service, faster trade clearing, and improved market access. But how will it impact your clients? Here are eight things to consider:

By Richard E. Austin | October 1, 2011 | Last updated on October 1, 2011

2 min read

Disciplinary matters.

Is anything outstanding with the dealer or a securities regulator? If so, a move may leave you in limbo by suspending your registration and a securities regulator may refuse to register you with your new dealer until all matters are resolved. This mistake casts your clients adrift (and makes them easy pickings for competitors).

Limit your moves.

Is this your second or third move in the past several years? That looks bad. Clients get concerned if you change dealers frequently.

Check the fees.

Find out if your new dealer’s fees for trading or maintaining client accounts are higher or lower than your current dealer’s.

If you have concerns about getting paid

what you’re owed, give notice after receiving payment. While you can sue to get paid or complain to the appropriate ministry, getting your money can take a lot of time and energy.

Don’t burn bridges.

As consolidation of dealers continues, never forget your old dealer may become your new dealer in the future.

Richard E. Austin

The new contract.

Has a lawyer looked over your contract with your new dealer and have you conducted due diligence? Check the new firm’s and its reps’ disciplinary record—you don’t want your name sullied by association. If no formal agreement is in place, send an email to the new dealer confirming the verbal terms—and get a reply. If the deal doesn’t go through, it can be hard to court another dealer without upsetting your clients.

Disciplinary matters.

Limit your moves.

Is this your second or third move in the past several years? That looks bad. Clients get concerned if you change dealers frequently.

Check the fees.

Find out if your new dealer’s fees for trading or maintaining client accounts are higher or lower than your current dealer’s.

If you have concerns about getting paid

what you’re owed, give notice after receiving payment. While you can sue to get paid or complain to the appropriate ministry, getting your money can take a lot of time and energy.

Don’t burn bridges.

As consolidation of dealers continues, never forget your old dealer may become your new dealer in the future.

Your agreement.

Find out if you’re subject to notice requirements and non-compete provisions, because they can call into question whether your clients are really yours. Be aware of obligations regarding client information, dealer information, non-solicitation of clients and use of clients lists.

The new contract.

Disciplinary matters.

Limit your moves.

Is this your second or third move in the past several years? That looks bad. Clients get concerned if you change dealers frequently.

Check the fees.

Find out if your new dealer’s fees for trading or maintaining client accounts are higher or lower than your current dealer’s.

If you have concerns about getting paid

what you’re owed, give notice after receiving payment. While you can sue to get paid or complain to the appropriate ministry, getting your money can take a lot of time and energy.

Don’t burn bridges.

As consolidation of dealers continues, never forget your old dealer may become your new dealer in the future.

Timing.

A move during a busy period isn’t wise, since it can take awhile to move your clients and their assets. In volatile markets, your clients want to be able to trade freely. While there are industry guidelines regarding how long it should take to move client assets from one dealer to another, they specifically allow for delays during RRSP season.
Your agreement.

Find out if you’re subject to notice requirements and non-compete provisions, because they can call into question whether your clients are really yours. Be aware of obligations regarding client information, dealer information, non-solicitation of clients and use of clients lists.
The new contract.

Has a lawyer looked over your contract with your new dealer and have you conducted due diligence? Check the new firm’s and its reps’ disciplinary record—you don’t want your name sullied by association. If no formal agreement is in place, send an email to the new dealer confirming the verbal terms—and get a reply. If the deal doesn’t go through, it can be hard to court another dealer without upsetting your clients.
Disciplinary matters.

Is anything outstanding with the dealer or a securities regulator? If so, a move may leave you in limbo by suspending your registration and a securities regulator may refuse to register you with your new dealer until all matters are resolved. This mistake casts your clients adrift (and makes them easy pickings for competitors).
Limit your moves.

Is this your second or third move in the past several years? That looks bad. Clients get concerned if you change dealers frequently.
Check the fees.

Find out if your new dealer’s fees for trading or maintaining client accounts are higher or lower than your current dealer’s.
If you have concerns about getting paid

what you’re owed, give notice after receiving payment. While you can sue to get paid or complain to the appropriate ministry, getting your money can take a lot of time and energy.
Don’t burn bridges.

As consolidation of dealers continues, never forget your old dealer may become your new dealer in the future.

Timing.

A move during a busy period isn’t wise, since it can take awhile to move your clients and their assets. In volatile markets, your clients want to be able to trade freely. While there are industry guidelines regarding how long it should take to move client assets from one dealer to another, they specifically allow for delays during RRSP season.
Your agreement.

Find out if you’re subject to notice requirements and non-compete provisions, because they can call into question whether your clients are really yours. Be aware of obligations regarding client information, dealer information, non-solicitation of clients and use of clients lists.
The new contract.

Has a lawyer looked over your contract with your new dealer and have you conducted due diligence? Check the new firm’s and its reps’ disciplinary record—you don’t want your name sullied by association. If no formal agreement is in place, send an email to the new dealer confirming the verbal terms—and get a reply. If the deal doesn’t go through, it can be hard to court another dealer without upsetting your clients.
Disciplinary matters.

Is anything outstanding with the dealer or a securities regulator? If so, a move may leave you in limbo by suspending your registration and a securities regulator may refuse to register you with your new dealer until all matters are resolved. This mistake casts your clients adrift (and makes them easy pickings for competitors).
Limit your moves.

Is this your second or third move in the past several years? That looks bad. Clients get concerned if you change dealers frequently.
Check the fees.

Find out if your new dealer’s fees for trading or maintaining client accounts are higher or lower than your current dealer’s.
If you have concerns about getting paid

what you’re owed, give notice after receiving payment. While you can sue to get paid or complain to the appropriate ministry, getting your money can take a lot of time and energy.
Don’t burn bridges.

As consolidation of dealers continues, never forget your old dealer may become your new dealer in the future.

Timing.

A move during a busy period isn’t wise, since it can take awhile to move your clients and their assets. In volatile markets, your clients want to be able to trade freely. While there are industry guidelines regarding how long it should take to move client assets from one dealer to another, they specifically allow for delays during RRSP season.
Your agreement.

Find out if you’re subject to notice requirements and non-compete provisions, because they can call into question whether your clients are really yours. Be aware of obligations regarding client information, dealer information, non-solicitation of clients and use of clients lists.
The new contract.

Has a lawyer looked over your contract with your new dealer and have you conducted due diligence? Check the new firm’s and its reps’ disciplinary record—you don’t want your name sullied by association. If no formal agreement is in place, send an email to the new dealer confirming the verbal terms—and get a reply. If the deal doesn’t go through, it can be hard to court another dealer without upsetting your clients.
Disciplinary matters.

Is anything outstanding with the dealer or a securities regulator? If so, a move may leave you in limbo by suspending your registration and a securities regulator may refuse to register you with your new dealer until all matters are resolved. This mistake casts your clients adrift (and makes them easy pickings for competitors).
Limit your moves.

Is this your second or third move in the past several years? That looks bad. Clients get concerned if you change dealers frequently.
Check the fees.

Find out if your new dealer’s fees for trading or maintaining client accounts are higher or lower than your current dealer’s.
If you have concerns about getting paid

what you’re owed, give notice after receiving payment. While you can sue to get paid or complain to the appropriate ministry, getting your money can take a lot of time and energy.
Don’t burn bridges.

As consolidation of dealers continues, never forget your old dealer may become your new dealer in the future.

Timing.

A move during a busy period isn’t wise, since it can take awhile to move your clients and their assets. In volatile markets, your clients want to be able to trade freely. While there are industry guidelines regarding how long it should take to move client assets from one dealer to another, they specifically allow for delays during RRSP season.
Your agreement.

Find out if you’re subject to notice requirements and non-compete provisions, because they can call into question whether your clients are really yours. Be aware of obligations regarding client information, dealer information, non-solicitation of clients and use of clients lists.
The new contract.

Has a lawyer looked over your contract with your new dealer and have you conducted due diligence? Check the new firm’s and its reps’ disciplinary record—you don’t want your name sullied by association. If no formal agreement is in place, send an email to the new dealer confirming the verbal terms—and get a reply. If the deal doesn’t go through, it can be hard to court another dealer without upsetting your clients.
Disciplinary matters.

Is anything outstanding with the dealer or a securities regulator? If so, a move may leave you in limbo by suspending your registration and a securities regulator may refuse to register you with your new dealer until all matters are resolved. This mistake casts your clients adrift (and makes them easy pickings for competitors).
Limit your moves.

Is this your second or third move in the past several years? That looks bad. Clients get concerned if you change dealers frequently.
Check the fees.

Find out if your new dealer’s fees for trading or maintaining client accounts are higher or lower than your current dealer’s.
If you have concerns about getting paid

what you’re owed, give notice after receiving payment. While you can sue to get paid or complain to the appropriate ministry, getting your money can take a lot of time and energy.
Don’t burn bridges.

As consolidation of dealers continues, never forget your old dealer may become your new dealer in the future.

Timing.

A move during a busy period isn’t wise, since it can take awhile to move your clients and their assets. In volatile markets, your clients want to be able to trade freely. While there are industry guidelines regarding how long it should take to move client assets from one dealer to another, they specifically allow for delays during RRSP season.
Your agreement.

Find out if you’re subject to notice requirements and non-compete provisions, because they can call into question whether your clients are really yours. Be aware of obligations regarding client information, dealer information, non-solicitation of clients and use of clients lists.
The new contract.

Has a lawyer looked over your contract with your new dealer and have you conducted due diligence? Check the new firm’s and its reps’ disciplinary record—you don’t want your name sullied by association. If no formal agreement is in place, send an email to the new dealer confirming the verbal terms—and get a reply. If the deal doesn’t go through, it can be hard to court another dealer without upsetting your clients.
Disciplinary matters.

Is anything outstanding with the dealer or a securities regulator? If so, a move may leave you in limbo by suspending your registration and a securities regulator may refuse to register you with your new dealer until all matters are resolved. This mistake casts your clients adrift (and makes them easy pickings for competitors).
Limit your moves.

Is this your second or third move in the past several years? That looks bad. Clients get concerned if you change dealers frequently.
Check the fees.

Find out if your new dealer’s fees for trading or maintaining client accounts are higher or lower than your current dealer’s.
If you have concerns about getting paid

what you’re owed, give notice after receiving payment. While you can sue to get paid or complain to the appropriate ministry, getting your money can take a lot of time and energy.
Don’t burn bridges.

As consolidation of dealers continues, never forget your old dealer may become your new dealer in the future.

Disciplinary matters.

Limit your moves.

Check the fees.

If you have concerns about getting paid

Don’t burn bridges.

Richard E. Austin

The new contract.

Disciplinary matters.

Limit your moves.

Check the fees.

If you have concerns about getting paid

Don’t burn bridges.

Your agreement.

The new contract.

Disciplinary matters.

Limit your moves.

Check the fees.

If you have concerns about getting paid

Don’t burn bridges.

Timing.

Your agreement.

The new contract.

Disciplinary matters.

Limit your moves.

Check the fees.

If you have concerns about getting paid

Don’t burn bridges.

Timing.

Your agreement.

The new contract.

Disciplinary matters.

Limit your moves.

Check the fees.

If you have concerns about getting paid

Don’t burn bridges.

Timing.

Your agreement.

The new contract.

Disciplinary matters.

Limit your moves.

Check the fees.

If you have concerns about getting paid

Don’t burn bridges.

Timing.

Your agreement.

The new contract.

Disciplinary matters.

Limit your moves.

Check the fees.

If you have concerns about getting paid

Don’t burn bridges.

Timing.

Your agreement.

The new contract.

Disciplinary matters.

Limit your moves.

Check the fees.

If you have concerns about getting paid

Don’t burn bridges.

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