Broker-dealers at the Financial Services Institute's OneVoice conference in Orlando shared their concerns that new regulations from Washington, coupled with the migration of advisors to the RIA business model, were acting to squeeze their firms' profit margins. However, a panel of CEOs praised Finra regulators for adopting a less confrontational posture towards brokerage firms and trying to make sense of the stream of regulations emanating from Congress.

The panel included Raymond James Financial Services CEO Dick Averitt, National Planning Holdings CEO Jim Livingston and Williams Financial Group founder and CEO Wilson Williams and was moderated by FSI's CEO Dale Brown. The conference had record attendance of about 640, with 35% new attendees.

Averitt speculated that the migration of reps to the RIA space could turn out to be a long-lasting megatrend. He recalled that 25 years ago Raymond James' independent contractor business was a small part of the firm's total revenues.

"Now it's our biggest business," Averitt said. Today, "we're wondering if it won't be the RIA business." If that turns out to prove prescient, Averitt noted Raymond James will have to make adjustments to maintain their profitability.

Williams, whose firm serves RIAs and dually-registered advisors like Raymond James, said that B-D's might need to add platform fees if the trend continues.

Livingston noted that some dually licensed reps affiliated with National Planning would show up at the firm's meeting and try to convince commission-based reps to move towards fees.

One brokerage executive wryly commented that the industry's leading custodian, Schwab Advisor Services, enjoyed much wider profit margins than FSI member firms did in either their brokerage or custodial businesses. "Most RIAs keep a lot of their clients' assets in [OneSource] mutual funds and Schwab earns 40 basis points," he said. "You do the math."

Williams commented that in the last three years he had found Finra to engage in less of a confrontational, "gotcha" manner than it had for most of the period between the mid-1990s and 2008. For his part, Averitt remarked the deluge of regulations coming out of Washington were slowed down by regulators' inability to keep up with writing and implementing rules to meet the volume of laws coming out of Congress.