Although the industry will welcome the change initially, it could ultimately hurt independent B-Ds that have catered to hybrids, said Robb Baldwin, president of TradePMR in Gainesville, Fla., a support platform for RIAs.
IBDs have been able to attract hybrids and charge them for RIA supervision, “but if the regulatory [requirement] goes away, the revenue goes away as well,” Baldwin said.
Baldwin added that if Finra goes ahead with the change, B-Ds may have to replace current supervisory systems that they use to gauge suitability for hybrid clients who conduct commission business.