Disclosures
GENERAL DISCLOSURE
Services and products described may not be eligible for solicitation in your state. This site is for use by individuals residing in states where our products and services may legally be offered.
The information on this site is not intended to be used as the primary basis for investment decisions.
NON-U.S. RESIDENTS
This site has been published in the United States for residents of the United States. We do reserve the right to require proof of residence from any user accessing this site and requesting information. It is not intended for use by, or to provide any information to investors outside of the United States. Investors outside of the United States are subject to securities and tax regulations within their applicable jurisdictions that are not addressed on this site.
BUSINESS CONTINUITY PLAN DISCLOSURE STATEMENT
Independent Financial Group, LLC has developed a Business Continuity Plan on how we will respond to events that significantly disrupt our business. Since the timing and impact of disasters and disruptions is unpredictable, we will have to be flexible in responding to actual events as they occur. With that in mind, we are providing you with this information on our business continuity plan.
Contacting Us. If after a significant business disruption you cannot contact your representative as you usually do at his or her branch office, you should call our firm’s home office at 858.436.3180 or go to our web site at www.ifgsd.com. If you cannot access us through either of those means, you should contact our clearing firm. Our clearing firm is Pershing, LLC. In the event that are unable to contact either your representative or the firm’s home office due to a significant business interruption, Pershing may be contacted directly to process limited trade-related transactions, cash disbursements, and security transfers. Instructions to Pershing must be in writing and transmitted via facsimile or postal service as follows: Pershing LLC, P.O. Box 2065, Jersey City, New Jersey 07303-2065, Fax: (201) 413-5368. For additional information about how to request funds and securities when we cannot be contacted due to a significant business interruption, please call (201) 413-3635 for recorded instructions. If you cannot access the instructions from the previously noted telephone number, Pershing may be contacted at (213) 624-6100 extension 500 as an alternate telephone number for recorded instructions.
Our Business Continuity Plan. We plan to quickly recover and resume business operations after a significant business disruption and respond by safeguarding our employees and property, making a financial and operational assessment, protecting the firm’s books and records, and allowing our customers to transact business. In short, our business continuity plan is designed to permit our firm to resume operations as quickly as possible, given the scope and severity of the significant business disruption.
Our business continuity plan addresses the following: data back up and recovery; all mission critical systems; financial and operational assessments; alternative communications with customers, employees, and regulators; alternate physical location of employees; critical supplier, contractor, bank and counter-party impact; regulatory reporting; and assuring our customers prompt access to their funds and securities if we are unable to continue our business.
In addition to our local physical backup, Pershing, LLC, backs up our important records in a geographically separate area. While every emergency situation poses unique problems based on external factors, such as time of day and the severity of the disruption, we have been advised by our clearing firm that its objective is to restore its own operations and be able to complete existing transactions and accept new transactions and payments within the same business day. Your orders and requests for funds and securities could be delayed during this period.
Varying Disruptions. Significant business disruptions can vary in their scope, such as only our firm, a single building housing our firm, the business district where our firm is located, the city where we are located, or the whole region. Within each of these areas, the severity of the disruption can also vary from minimal to severe. In a disruption to only our firm or a building housing our firm, we will transfer our operations to a local site when needed and expect to recover and resume business within 24 hours. In a disruption affecting our business district, city, or region, we will transfer our operations to a site outside of the affected area, and recover and resume business within 48 hours. In either situation, we plan to continue in business, transfer operations to our clearing firm if necessary, and notify you through our web site www.ifgsd.com or our customer emergency number, (858) 436-3180, as to how to contact us. Please be aware that we cannot guarantee that we will be successful in achieving recovery in the times noted above. If the significant business disruption is so severe that it prevents us from remaining in business, we will assure our customer’s prompt access to their funds and securities.
For More Information. If you have questions about our business continuity planning, you can contact us at customerservice@ifgsd.com.
SEC ORDER EXECUTION AND ROUTING DISCLOSURE
U.S. Securities and Exchange Commission ("SEC") Rule 606 (formerly11Ac1-6) requires all brokerage firms to publicly disclose their order routing practices. Disclosure is to describe routing of "non-directed orders," that is, orders that customers have not specifically asked to have sent to a particular venue for execution. With respect to Independent Financial Group, LLC’s relationships with trading venues, Independent Financial Group, LLC directs all trades in over-the-counter (OTC), listed stock, and options to our clearing firm, Pershing, LLC, for execution. Independent Financial Group, LLC does not receive compensation for directing this order flow to Pershing. The designated market makers to whom orders are automatically routed are selected by Pershing based on the consistently high quality of their executions in one or more market segments and their history of seeking price improvements. Pershing regularly reviews reports for quality of execution purposes. To view the most recent quarterly report, go to www.orderroutingdisclosure.com. Enter the firm name exactly as it appears below and click on “GO”.
Independent Financial Group LLC
POTENTIAL CONFLICTS OF INTEREST
Independent Financial Group, LLC (“Independent Financial Group”) offers a wide range of mutual fund, variable annuity, variable life insurance, Direct Participation Programs (“DPPs”), Real Estate Investment Trusts (“REITS”), equities, fixed income and third party money management services through both our clearing firm, Pershing, LLC and through direct selling agreements with the sponsoring companies. The purpose of this disclosure document is to provide information regarding the costs associated with investing in these products, how the representative is compensated when clients purchase these products and how Independent Financial Group is compensated by the sponsor companies.
Independent Financial Group holds the fundamental belief that each investor with the guidance of their representatives has the right to choose the investments that provide the greatest chance of achieving their financial goals. As such, we do not offer proprietary products and do not maintain a list of preferred investment companies. We do, however, have the responsibility to disclose fees and potential conflicts of interest in order for the client to make an informed decision before investing in certain products. Therefore, a description of customary sales charges, compensation, additional support and compensation associated with these investments is provided below.
ADDITIONAL COMPENSATION DISCLOSURES
Mutual Funds. Before investing in mutual funds, it is important to understand their associated fees and expenses. Mutual funds have ongoing expenses that clients will pay as long as they hold the funds. Most funds pay a sales commission to the representative when the fund is purchased in addition to the annual costs that are associated with operating the fund. Annual operating expenses include management fees, 12b-1 fees (payments made in connection with marketing and distribution expenses which may include trailing compensation to representatives), the cost of shareholder mailings and other expenses. Investors should always consult the fund’s prospectus for specific details regarding fees, expenses and charges.
Certain mutual fund companies may pay Independent Financial Group to support our Conference Program as described in further detail in the section titled “Conference Program”. These sponsors have greater access to our representatives to provide educational and training opportunities. For example, sponsors may also host events for individual representatives and their clients such as seminars and client appreciation events. Not all sponsors participate at the same level and participation is voluntary. Depending on the level of participation, payments to support the Conference Program may range from $2,500 to $40,000.
The following mutual fund companies have or are currently participating in the Independent Financial Group Conference Program:
| Federated Investors Inc MFS Investments | Oppenheimer Funds Putnam Investments | RADY Assets Sierra Retirement Fund |
Variable Products. Independent Financial Group currently receives compensation in different ways from the purchase of variable annuities and variable life insurance. Similar to mutual funds, Independent Financial Group is paid by variable product companies based on the fees paid by the investor and a portion of that payment is paid to the representative.
In addition to customary compensation from variable product companies that include commissions and ongoing payments (known as residuals or trails), Independent Financial Group may receive additional compensation from certain variable product sponsors under a revenue sharing agreement. Representatives do not receive a greater or lesser commission from sales under this agreement, however the marketing and educational activities paid for with these payments may lead representatives to focus on those funds when making recommendations. Although compensation may vary, we may receive up to 10 basis points (0.10%) of the gross amount of each sale of a variable product, excluding purchases made in IFG fee-based advisory programs. For example, a $10,000 transaction with a participating company could result in a one-time payment of $10 under this agreement. The following variable product sponsor(s) currently participate in the revenue sharing program:
ING USA Annuity and Life Insurance Co. |
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Certain variable product companies may pay Independent Financial Group to support our Conference Program as described in further detail in the section titled “Conference Program”. Not all sponsors participate at the same level and participation is voluntary. These sponsors have greater access to our representatives to provide educational and training opportunities. For example, sponsors may also host events for individual representatives and their clients such as seminars and client appreciation events. Not all sponsors participate at the same level and participation is voluntary. Depending on the level of participation, the payments to support the Conference Program may range from $2,500 to $40,000.
The following variable product companies have or are currently participating in the Independent Financial Group Conference Program:
Allianz Life Financial Services | MetLife |
Direct Participation Programs. We receive compensation from Direct Participation Program (“DPP”) sponsors (REITs, Limited Partnerships, Oil and Gas programs and Tenant-in-Common offerings) that includes commissions and due diligence/marketing allowances from the sponsor. Commissions are described in detail in the offering’s Private Placement Memorandum, vary depending upon the offering and range from 2.00% to 9.00%. Due diligence/marketing allowances typically range from 0.5% to 1.00%. In some cases, a portion may be shared with the representative.
In addition, certain DPP sponsors may pay Independent Financial Group to support our Conference Program as described in further detail in the section titled “Conference Program”. These sponsors have greater access to our representatives to provide educational and training opportunities. For example, sponsors may also host events for individual representatives and their clients such as seminars and client appreciation events. Not all sponsors participate at the same level and participation is voluntary. Depending on the level of participation, the payments to support the Conference Program may range from $2,500 to $40,000.
The following Direct Participation Program sponsors have or are currently participating in the Independent Financial Group Conference Program:
American Realty Capital | Grubb & Ellis (NNN) |
PASSCO Companies |
Asset Management Programs. Independent Financial Group in its capacity as a Registered Investment Advisor (RIA) may engage in solicitors’ agreements with third party money managers or investment advisory companies and receives compensation for such services based on deposits or assets placed under management. A portion of these fees are paid to Independent Financial Group Investment Advisor Representatives (IARs).
Additionally, Independent Financial Group receives distribution allowances, due diligence fees, platform expenses and other payments from certain third party money managers of up to 10 basis points (0.10%) annually on assets placed with the managers and custodians. These fees are retained by Independent Financial Group and are not paid to any of its IARs. As a result, IARs do not receive a greater or lesser fee for selecting one advisor over another. In all cases, such fees are paid from the money manager’s own resources and not from client assets. The following third party money managers currently participate in this payment arrangement:
AAM |
Certain investment advisory companies may pay Independent Financial Group to support our Conference Program as described in further detail in the section titled “Conference Program”. These sponsors have greater access to our representatives to provide educational and training opportunities. For example, sponsors may also host events for individual representatives and their clients such as seminars and client appreciation events. Not all sponsors participate at the same level and participation is voluntary. Depending on the level of participation, the payments to support the Conference Program may range from $2,500 to $40,000.
The following investment advisory companies have or are currently participating in our Conference Program described below.
Absolute Capital |
FTJ Fundchoice |
529 Plans. Similar to mutual funds, Independent Financial Group is paid by the fund family or distributor based on the fees paid by the investor. A portion of that payment goes to the representative. Independent Financial Group does not have a revenue sharing program with any 529 Plan sponsors nor do we receive any additional fees (conference or marketing fees) other than those disclosed in the issuer’s offering statement.
Money Market Funds. Brokerage accounts provide automatic daily cash sweep programs into client selected money market funds offered by Federated Financial Services Company and Dreyfus Insured Deposit Program. Independent Financial Group may receive compensation of up to 0.15 percent of the assets invested in Dreyfus Insured Deposits and up to 0.35 percent of the assets invested in Federated money market funds. Independent Financial Group representatives do not receive any portion of these payments.
Banking Products. Independent Financial Group provides bank products such as checking, savings, money market and CDs from Bank of Internet USA. Independent Financial Group may receive up to .35% on assets in these products. Independent Financial Group representatives receive a portion of these payments.
CONFERENCE PROGRAMS
Independent Financial Group’s representatives have the ability to create investment portfolios from a variety of approved products and programs. Certain product sponsors contribute additional funds and resources to programs that support our marketing, education and training efforts, such as our national conference and other seminars or conferences conducted throughout the year (“Conference Program”).
The amounts that product sponsors pay to participate in the Conference Program is based on a tiered platform that ranges from $2,500 to $40,000 and according to the events and activities the sponsor chooses, may include: conference calls, web-casts, Top Producer Event, and National Conference exhibit booths.
In addition, product sponsors and other companies may also reimburse up to 100% of the cost of due diligence, training and education/joint marketing meetings for our representatives, as permitted by industry rules. Sales of any products by Independent Financial Group representatives may qualify them for additional cash and non-cash compensation that may include support for their business activities, attendance at seminars, conferences and entertainment.
It is important to know that although the product sponsors contribute these funds to Independent Financial Group and may have greater access to our representatives’ the client does not pay more to purchase these products through Independent Financial Group than they would through another broker-dealer. The payment of this additional compensation to Independent Financial Group by these product sponsors may pose a financial incentive to promote certain products over other products, although we do not believe that these arrangements compromise the service the representative provides to the client.
CONTACT US
Questions regarding the information contained in this document should be directed to: Independent Financial Group, LLC, Attn: Compliance Department, 12636 High Bluff Drive, Suite 100, San Diego, CA 92130. Member FINRA/SIPC.