THE BUSINESS WE'RE IN
If you're not familiar with the financial services industry (and even if you are!), the following provides a basic understanding of what Commonwealth does and how we fit into the big picture.
What it means to be an independent B/D and IA
A dually registered broker/dealer and investment adviser is a company that buys and sells investment products on behalf of investors and/or provides investment advisory services to investors. In our case, investors don't contact us directly; rather, we receive instructions from the 1,650-plus financial advisors who are affiliated with us. We function as the unseen back office that processes client transactions for them.
Ours is a heavily regulated business. As a dually registered broker/dealer and investment adviser, Commonwealth is regulated by the Securities and Exchange Commission (SEC), the Financial Industry Regulatory Authority (FINRA), and each of the 50 states.
The SEC regulates both broker/dealers and investment advisers. While the SEC maintains the direct responsibility to oversee SEC-registered investment advisers, it delegates the supervision of broker/dealers and their financial advisors to FINRA. FINRA, in turn, requires all broker/dealers and their financial advisors to register with FINRA for supervision purposes. In addition to that, each of the individual states requires all broker/dealers and financial advisors who solicit or transact business within that jurisdiction to register with the state as well.
We like to think that even if our advisors were not required to work with a broker/dealer, they would choose to partner with us! The fact that we are independent means that our advisors work for themselves out of their own offices and are free to help clients choose the best investment products to meet financial goals—without pressure to sell a particular company's products. This business model differs from that of other, large financial institutions, known as wirehouses, whose advisors (stock brokers) are employees of the company and may be more restricted in the products and services they are able to offer their clients.
HOW COMMONWEALTH IS STRUCTURED
Click on the links to see a list of departments in each functional area.