Securities America March 2016 STAR

A Bi-monthly Publication from Your Business Growth Expert

MARCH 2016

ANNOUNCING: Securities America’s

2015 Award Winners

ALSO IN THIS ISSUE: 2016 Council Members Technology Tips for Tax Season Next Gen Mentoring Program: Mentoring Helps Young Advisors Skip School of Hard Knocks Spotlight: Kimberly Kropp Plans to Use FSI Board Position to Promote the Positive

REGISTER NOW!

SECURITIES AMERICA NATIONAL CONFERENCE ORLANDO, FLORIDA June 10-13, 2016

Keynote Presenters

Denver Broncos Super Bowl winning quarterback PEYTON MANNING

Internationally recognized graffiti artist, author and entrepreneur ERIK WAHL

Securities America’s Connect National Conference is quickly approaching. Join us at the Hilton Bonnet Creek in Orlando.

Noteworthy Events

With Walt Disney World and Universal Studios close by, Connect ’16 combines excellent professional development opportunities and networking venues with leisure time for fun with friends and family.

Pre-Conference Sessions Friday, June 10, 9 a.m. to 5 p.m.

We’ll have industry experts on hand to present their insights on the latest trends as well as effective sales and marketing practices. There are over 90 educational sessions on the agenda, including SAM Talks, the advisor-presented talks that link personal experience to big ideas.

Get extensive education and training on the proposed DOL fiduciary rule – potentially the biggest change to our business in a generation.

Join your colleagues to understand and plan for what's next.

Register no later than Friday, May 6.

Opening General Session with Peyton Manning Friday, June 10, 6 p.m.

Firm Element CE Sunday, June 12, 3:30 p.m. to 5 p.m.

Closing General Session and AML CE Monday, June 13, 1 p.m. to 3:30 p.m.

Closing Night Party at Universal Studios Monday, June 13, 3:30 p.m.

Register online using the link you received by email from Securities America Travel Headquarters.

Visit the Business Center home page to view the preliminary agenda.

Star

The

Contents MARCH 2016 Feature Story

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2015 Award Winners Securities America proudly honors the outstanding business achievements of our advisors and branches in 2015.

Need to Know

3 Upcoming Conferences 4 Media Mentions 5 News and Announcements 8 Welcome New Advisors 9 2016 Council Members 19 Technology Notes 23 Technology Training Resources

33 Compliance

Are You Opening the Door for Hackers?

37 Spotlight - Kimberly Kropp

Kimberly Kropp Plans to Use FSI Board Position to Promote the Positive

39 FSI Update

Looking Ahead at 2016: State Regulations and Legislation

Columns

21 Technology

Technology Tips for Tax Season

25 Practice Management

First Friday Coaching Virtual Meetings for Advisors Providing a Safety Net Next Gen Mentoring Program, Part 1

Connect with Us FACEBOOK facebook.com/SecuritiesAmericaInc TWITTER twitter.com/SecuritiesAm LINKEDIN linkedin.com/company/securities-america-inc YOUTUBE youtube.com/SecuritiesAmericaInc

MARCH 2016 | The STAR 2

Upcoming 2016 Conferences April 18-21

Masters Series Study Group – Dallas, Texas Exclusive study group for Securities America’s top advisors based on annual GDC and fees. Discussion topics and activities for this facilitated study group will be determined by the study group participants.

June 10-13

Connect National Conference – Orlando, Fla. Four days at Hilton Bonnet Creek packed with content to increase efficiency and effectiveness, improve profitability and secure your practice now and for the future. You’ll hear from keynote speakers, subject matter experts from the home office, professionals from our strategic partner companies and your peers. Get extensive education and training on the proposed DOL fiduciary rule – potentially the biggest change to our business in a generation.

July 19-20

Next Level #14 – Workshop #2 – Omaha, Neb.

Aug. 16-17

Securities America Financial Institutions Conference – La Vista, Neb. Created to help educate and engage the bankers our firms work with, our third annual conference features training and development on new technology, product updates, business growth and more for Securities America financial institution advisors, OSJs and management. Attendees benefit from great networking opportunities with peers and finish up the conference with a golf outing or visit to an Omaha attraction.

Sept. 20-21 Oct. 6-7

Next Level #15 – Workshop #1 – Omaha, Neb. Assistant University and Principal Meeting – Omaha, Neb. Training and networking event for sales assistants, support staff and office managers. This two-day workshop provides the opportunity to increase staff’s knowledge in technology, compliance, operations and practice management. The Principal Meeting has an agenda specifically designed to help acting principals, OSJs and production group leaders enhance their knowledge and abilities to better fulfill their compliance management responsibilities.

Oct. 20-21

Ladenburg Institute of Women and Finance Symposium – Salt Lake City, Utah This high-value, invitation-only event based on advisor GDC and fees provides additional education and networking support to the family of advisors affiliated with Ladenburg's independent brokerage and advisory firms. This event is dedicated to developing and accelerating the success of female advisors.

Oct. 25-28 Nov. 7-8

Masters Series Study Group – Atlanta, Ga. NextPhase Income Distribution – Scottsdale, Ariz.

This invitation-only event includes advanced topic presentations from home office staff and industry experts, including how to use Securities America tools and resources, Social Security and insurance planning. This event will also include break-out sessions with industry experts on a range of topics specific to income-distribution planning. We will provide information to help build your business, access to industry experts and networking opportunities.

Nov. 8-10

Managed Money Conference – Scottsdale, Ariz.

We bring together representatives from our best third-party money managers to show you how to build your business and client relationships with managed money. Presentations will cover how managed accounts can improve your competitive edge, how to sell managed money and the different investment strategies used by the money managers. Attendees will also be given an exclusive briefing on enhancements and initiatives underway at Securities America to provide a greater competitive advantage in the marketplace.

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Media Mentions  Embattled RCS Advisors Get Relief from Company Bankruptcy Plan FA-Mag.com – RCS Capital Corp.’s bankruptcy filing sounds like a bad development, but it may actually provide some relief to its embattled advisors. “We just had three Cetera recruits visiting today,” said Arthur Cooper, co-founder of Cooper McManus, a hybrid firm in Irvine, Calif., and one of the biggest offices of Securities America. “They’re definitely looking and being proactive about it, talking to multiple B/Ds,” Cooper said in mid-January after the bankruptcy announcement. “The number one thing they mention is they’re tired of having to create excuses about what’s going on at RCS Capital.”

 Obama Swings by Home of Papillion Teacher to Ease Fears About the Future Omaha.com – It was about a year ago that Lisa Martin woke in the middle of the night to feed her newborn son, Cooper, and found herself overwhelmed with feelings of dread and hopelessness. To help ease her concerns about the future, she wrote a letter to President Barack Obama. In response, the president paid a visit to Lisa and her husband, Jeff, a transition specialist at Securities America, during his Jan. 13 trip to Omaha.

 Setting Financial Goals Early Is Important Aspect of Establishing Retirement Plan Midlands Business Journal – Roth provisions are popular because they give employees advantages in both before and after tax contributions, said Kimberly Kropp, owner/ partner at Moylan Kropp in Omaha, Neb. The most common plans in the corporate workplace are 401(k), 401(a), 403(b) and 457 plans that provide Roth provisions, so employees have advantages before and after tax contributions, Kropp said. “This especially is important for those who make more than the normal Roth IRA income limits and are unable to contribute to the standard Roth IRA,” she said.

MARCH 2016 | The STAR 4

News and Announcements  Two Promoted to Officer Positions, Two Others Named Senior Regional Directors Four Securities America employees received promotions to start 2016, including two who became officers for the first time.

Teri Heim was promoted to first vice president, business growth programs.

Heim joined Securities America in 1991 and is responsible for developing and marketing business growth programs to the company’s independent financial advisors. She wrote several of the company’s practice management and business development guides.

Heim was previously the director of training and has worked in the company’s Operations, Trading and Sales Supervision Departments.

She earned a bachelor’s degree in finance and management from the University of Nebraska and a master’s degree in adult learning, development and performance from Drake University. She is certified from the Crosby Institute as a master quality facilitator and trainer.

Brian Strasser was promoted to first vice president, transition. Strasser joined Securities America in 2013 as a director in Branch Office Development, where he focuses

5 The STAR | MARCH 2016

on advisor transition. He began his career in 1994 at TD Ameritrade working in the Mutual Fund Department before transitioning to Correspondent Services.

Strasser also worked for Kirkpatrick Pettis, a regional broker-dealer, where he helped launch the Advisor Services Department. He holds a bachelor’s degree and an MBA from the University of Nebraska at Omaha.

Sam Briganti was promoted to senior regional director for Branch Office Development — Western Great Lake region. He joined Securities America in 1997 and was a manager for 14 years in the Operations and Branch Office Development Departments. He became regional director of recruiting in 2013.

Briganti completed the Emerging Leaders Program, formed the New Advisor Experience Team, contributed to several broker-dealer acquisitions and recruited GDC of $26 million as a regional director. He received the Manager of the Year award in 2010 and Employee of the Year award in 2003.

Michael Belluomini was promoted to senior regional director for Branch Office Development — Southeast region.

Belluomini joined Securities America in 2005 and worked in the Rep Relations and Practice Management Departments prior to joining Branch Office Development in 2008.

He oversaw the development of the Relationship Management and Branch Sales Departments and was responsible for retention efforts. Since moving into recruiting in 2012, Belluomini has recruited $32 million in new advisor GDC.

To earn the charter, an individual must enroll in the CFA program, pass all three exams, have four years of professional work experience in the investment decision-making process and join the CFA Institute as a regular member.

“The thing that impressed me most was how this program stressed ethics more than any other education I’ve received,” said Haiar.

“I appreciate the opportunity and support Securities America gave me. Without it, I wouldn’t have been able to earn this valuable designation.”

Haiar has been with Securities America for 15 years. Prior to joining the Due Diligence Department in 2012, he served as a technical consultant and operations manager. He earned a master’s degree in economics from the University of Nebraska at Omaha in 2010.

 Marc Haiar Awarded CFA Credential Securities America Due Diligence Consultant Marc Haiar recently earned his Chartered Financial Analyst® (CFA) credential from the CFA Institute.

The globally recognized CFA credential is considered the industry benchmark for measuring expertise, experience and ethics of investment professionals. To successfully complete the program, an enrollee needs to demonstrate mastery of a broad range of practical portfolio management skills.

 We’d Love Your Feedback What do you think about Securities America’s new Business Center website? If you have not done so yet, please take a few minutes to complete the short survey that was sent to you recently via Webmail. Your feedback will help us continue to enhance the site to best meet your needs. Thank you for your participation and comments.

The CFA program is offered in a self-study format and is divided into three exams focusing on investment tools, asset valuation and portfolio management. Exams for each section are administered one year apart.

MARCH 2016 | The STAR 6

News and Announcements

Advisor News

Share your professional or philanthropic news with us by emailing advisornews@saionline.com.

 Michelle Oliver Recognized as 2016 Visionary Securities America advisor, Michelle Oliver, was one of two recipients of Urban Views Weekly’s 2016 Visionaries in the Greater Richmond, Va. area. The individuals recognized not only believe in the teachings and work of Dr. Martin Luther King, Jr., but also display many of his characteristics and qualities as they improve the lives of others.

As president and financial advisor for the Oliver Financial Group, Oliver routinely talks to women about financial concerns that burden their communities. Her compassion for women facing unexpected circumstances leads her to assist women in transition from divorce or the death of a spouse. Oliver has a knack for working with different markets, developing an understanding of various parties, is passionate about promoting financial literacy and enjoys helping others make positive changes for themselves and their families.

“My charge in life is to help others understand finances, to convince them putting money away for your retirement is not a sin and you are not going to starve,” she said.

 Tom Potter Reaches Personal Donation Goal Last year, Tom Potter of Potter Financial Services was fortunate enough to set and meet a personal record of 24 double platelet blood donations.

“Sitting still on a gurney for about an hour is the easiest way I can think of to save about four lives,” Potter said.

Another cause that Potter feels strongly about is Food for the Poor, located in Coconut Creek, Fla. This charity uses 95 percent of donations to feed children and provide clean drinking water worldwide, taking only 5 percent for administration.

In describing his charitable work, Potter said, “In a rather ironic way, I feel this involvement has helped me better manage the millions I'm fortunate to oversee for my clients.”

nice work good job

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Welcome New Advisors Advisor

Previous Broker-Dealer

Andrew Pool

FSC Securities Corporation

Ashby Cook

Lincoln Financial Securities Corporation

Barbara Kiddoo

Midwestern Securities Trading Company

Benjamin Johnson

Woodbury Financial Services

Brian Martin

1st Global Capital Corporation

Daniel Pasternack

Dunham & Associates Investment Council

David Mann

ProEquities

Dennis Kinzie

Allstate Financial Services

Elijah Yurkin

R.M. Stark & Co.

Gregory Gonzalez

Adirondack Trading Group

Hilary Campbell

LPL Financial

Jerred Brown

Edward Jones

John Campbell

LPL Financial

Jose Ortiz Caceres

Oriental Financial Services Corporation

Louis Mancinelli

Adirondack Trading Group

Marc Miner

MML Investors Services

Mark Grooters

Edward Jones

Marty Tydings

Cetera Advisor Networks

Mary Slane

Sterne Agee Financial Services

Matthew Schiller

Fifth Third Securities

Michael Heath

First Allied Securities

Paul Reidy

BB&T Securities

Paul Vega

LPL Financial

Perry Defontaine

SII Investments

Robert Lemley

Independent Financial Group

Robert Worrell

Investors Capital Corporation

Ryan Gigous

Waddell & Reed

Sandy Wheaton

Voya Financial Advisors

Shawn Layton

ProEquities

Steven Smailes

Morgan Stanley

Travis Moomey

LPL Financial

Tyler Stephens

Raymond James & Associates

MARCH 2016 | The STAR 8

2016 Securities America

Council Members Advisory Council Current Members The Securities America Advisory Council creates an opportunity for advisors to provide feedback on the firm’s strategy, tactics and marketing message. It also allows Securities America to build strong personal relationships with its advisors. Securities America selects members of the advisory council from its top financial advisors.

• Sean Buckley

Worthington, Ohio

sean@buckleyfp.com

• Jordan Dechtman

Centennial, Colo.

jordan@jordandechtman.com

• Paula Dorion-Gray

Crystal Lake, Ill.

paula@doriongray.com

• Ronald Eckloff

Kearney, Neb.

reckloff@barneyinsurance.net

• Elinor Ho

Southfield, Mich.

eho@spsfinancial.com

• Kevin Korhorn

Granger, Ind.

kkorhorn@korhorn.com

• Michael Wendlandt

Billings, Mont.

mg@apexcompanies.com

• Nan Zimdars

Fitchburg, Wis.

nzimdars@zimfin.com

Advisory Council New Members for 2016 (member bios on the following pages) • Thom Hall

Midvale, Utah

thom@thomkhall.com

• Laurie Humphrey

St. Cloud, Minn.

lauriehumphrey@granitefinancial.net

• Frank Legan

Cleveland, Ohio

flegan@cedarbrookfinancial.com

• John Lindsey

Westlake Village, Calif.

john@lindseyandlindsey.com

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New 2016 Securities America Advisory Council Members Thom Hall, CFP®, CFC President - Thom K. Hall Financial Group Thom Hall founded Thom K. Hall Financial Group in 2000 and has been advising clients on how to preserve and manage wealth for more than 20 years. He excels at developing a uniquely customized approach for each client’s planning needs, objectives and goals. His entire process revolves around the client.

As a CERTIFIED FINANCIAL PLANNER™ professional and a Chartered Financial Consultant®, Hall believes financial planning is about a person’s values and not just his or her money. His focus is protecting someone’s purchasing power, not simply his or her principal. He believes it is important to develop the right retirement plan for an individual’s situation by using tools that help manage taxes, market volatility and risk. He has taught sound financial principles to a wealth of individuals over the years and currently teaches educational seminars to corporations and federal agencies. He shares strategies to help his clients overcome emotional decisions and ensure his clients’ income in their retirement years.

Hall is a past president and board of directors member for the Financial Planning Association of Utah. He serves as an instructor for the Federal Benefits Training Network and is executive director for the Salt Lake Chapter of Final Transitions Planning. He joined Securities America in 2005.

A resident of Draper, Utah, Hall devotes his free time to his family and scouting and enjoys a wide range of outdoor recreational activities.

Laurie Humphrey Owner - Granite Financial Laurie Humphrey is the owner and lead financial advisor of Granite Financial, which was founded by her mother, Pat Hinds, more than 20 years ago in St. Cloud, Minn. Humphrey acts as the primary advisor for all long-term decisions for clients, including income distribution and long-term care planning.

continued on page 11

MARCH 2016 | The STAR 10

Humphrey began working part-time at Granite Financial in 1996 while attending St. Cloud State University. After graduating cum laude, she specialized in long-term care insurance in the Twin Cities for more than five years. Ultimately, she became the brokerage manager for the Twin Cities firm, responsible for training more than 2,000 insurance agents in a five-state region on the importance of long-term care insurance, how it works, the significance of the policies that were available and how they pay claims.

Humphrey returned to Granite Financial in 2006, adding marketing and client service to her skill set while completing the requirements to become a fully licensed financial advisor. Humphrey became securities licensed in 2014 and took ownership of Granite Financial. She is currently working toward her Retirement Income Certified Professional designation and recently participated on a panel discussing long-term care planning at the Fourth Annual Ladenburg Institute of Women and Finance Symposium.

Humphrey loves spending time with her husband and kids. Her family enjoys being outdoors, camping and going to their cabin on Pelican Lake whenever possible. She and her family are active in their church. Both Laurie and her husband, Josh, have been on mission trips, and she would like to go on mission trips with her kids someday.

Frank Legan Partner - Cedar Brook Financial Partners Frank Legan is a partner with Cedar Brook Financial Partners LLC as well as a member of the investment committee. Legan designs and implements comprehensive, personalized financial planning strategies for corporate executives, closely held business owners, families and retirees. He specializes in lifetime income planning, investment planning and estate and risk management planning services. He also works with businesses to develop strategic and succession planning strategies.

Legan has a Bachelor of Arts degree in political science from the University of Dayton, as well as a Master of Public Administration degree focused on municipal management from Cleveland State University. Active in his community, Legan has served as a council representative at large for the City of Highland Heights, as well as vice president and secretary for the Hillcrest Council of Councils. He currently serves as a board member for Catholic Charities Diocese of Cleveland and as a member of the program committee for the Ohio Buckeye Chapter of the National Multiple Sclerosis Society. He is also a past board member of the Mayfield Area Chamber of Commerce.

Legan joined Securities America in 2010.

Legan and his family are volunteers at St. Francis of Assisi church in Gates Mills, where he serves as a member of the parish council and as a lector. Legan lives in Gates Mills with his wife Laura, daughter Reese and their collie Charlie.

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John Lindsey, CFP® CEO - Lindsey and Lindsey Wealth Management John Lindsey is a former apparel industry senior executive who worked for key brands such as Oshkosh B’ Gosh and Jantzen Sportswear. He was with Edward Jones for more than 15 years, beginning in 1996. When he joined, his office in Simi Valley was among the top three percent volume offices in the country for Edward Jones. He founded Lindsey and Lindsey Wealth Management Inc. with Securities America in 2012 to better serve his client base with an expanded universe of investment offerings.

Lindsey holds Bachelor of Science and Master of Business Administration degrees from the University of Southern California. He studied at the California Institute of Finance at Cal Lutheran University to become a CERTIFIED FINANCIAL PLANNER™ professional.

He has been married to his wife, Karen, for 33 years. They have three daughters: Christina, Alissa and Jenna. He and his family attend Discovery Church in Simi Valley. Lindsey enjoys spending time with his family, scuba diving, riding his Harley-Davidson and being deeply involved in the Ventura County, Conejo and Simi Valley communities (YMCA, Simi Valley Education Foundation and United Way of Ventura County).

Lindsey is an active member of the Chamber of Commerce and a leadership graduate. He serves as treasurer on the board of the Simi Valley Free Clinic and is a board member of the United Way of Ventura County.

Financial Institutions Advisory Council The Financial Institutions Advisory Council is an opportunity for financial institution advisors to provide insight into current challenges and changes in the financial institutions environment. Additionally, it provides feedback on specific products and services needed to enhance relationships with clients and members. It also creates an opportunity for Securities America’s executive team to communicate the firm’s initiatives and accomplishments while building personal relationships with our financial institution advisors.

• Thomas Alexander Clear Lake Bank & Trust

talexander@investmentcenterclearlake.com

• Walter Billodeaux

State Dept. Federal Credit Union

walter@sdfcuinvest.org

• Kendall Hahn

American National Bank

khahn@anbank.com continued on page 13

MARCH 2016 | The STAR 12

• Matt Lawler

F & M Bank

matt.lawler@securitiesamerica.com

• Robert Rader

United Prairie Bank

rrader@unitedprairiebank.com

• Jason Stahl

Dakota Community Bank & Trust

jason.stahl@securitiesamerica.com

• Gina Van Baren

DeMotte State Bank

gvanbaren@dsbwealth.com

• Nate Wyatt

The Gothenburg State Bank & Trust Co. nwyatt@investmentservicecenter.net

Branch Manager Advisory Council The Branch Manager Advisory Council provides an opportunity for branch managers to offer feedback and share ways Securities America can support the growth and management of successful branch offices. It also allows Securities America’s executive team to communicate the firm’s initiatives and accomplishments to branch managers and to build personal relationships and create strong strategic partnerships. The council meets in person twice a year and acts as a liaison to other OSJ/branch managers who have issues and concerns they would like communicated to the home office.

• Arthur Cooper

Cooper McManus Wealth Management

acooper@coopermcmanus.com

• Jack Connealy

JFC Financial Services

jack@jfcfinancial.com

• Bill Glubiak

Cedar Brook Financial Partners

wglubiak@cedarbrookfinancial.com

• Chuck Hais

Queen City Financial Advisors

chuck.hais@securitiesamerica.com

• Chris Holloway

Investor Securities Group

cholloway@isgva.com

• Amy Lipsitz

L & M Financial

alipsitz@lmfs.net

• Rob Santoriello

Iron Point Financial Advisors

robert.santoriello@securitiesamerica.com

• Todd Terhorst

Diversified Wealth Management

todd@diversifiedwealthmanagement.com

• Clyde Wyatt III

Navigation Financial

cwyatt@navigationfinancial.com

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Sales Assistant Advisory Board Behind every successful advisor is a top-notch assistant. Assistants are the backbone of our industry. Where would your office be without the person who takes care of all the “little” details? Because Securities America believes we can all learn from these experts, we established the Sales Assistant Advisory Board. This board gives our front-line customers the opportunity to offer ideas for improved services and suggest initiatives to Securities America.

• Heather Costner

Peter Nelson, John Nelson

hcostner@spectrum-financial-inc.com

• Betsy Dickey

Ron Harczak

betsy@ronharczak.com

• Dianna Dunlap

Becky Hudson

dianna.hill-dunlap@securitiesamerica.com

• Susan Erickson

Mark Slattery, Shannon Case

susan@caseslattery.com

• Beth Hodges

Chuck Hais

beth.hodges@queencityadvisors.com

• Maureen Lariviere Nate Wyatt

mlariviere@investmentservicecenter.net

• Jennifer Martin

Mark Lurz

jmartin@lpfadvisors.com

• Jennifer Nelson

Todd Terhorst

jennifern@diversifiedwealthmanagement.com

• Diane Strickland

Dean Evans

dstrickland@ehgfinancial.com

• Beth Thieman

Pat Hinds, Laurie Humphrey

beththieman@granitefinancial.net

MARCH 2016 | The STAR 14

Feature Story

2015 Award Winners Securities America proudly honors the outstanding business achievements of our advisors, principals, assistants and branches in 2015. Top 15 advisors and branches were recognized at Masters Forum.

All others will be recognized at the Securities America Connect National Conference.

Top 15 Advisors Overall

Top 15 Advisors Fee-Based AUM

1 Jordan Dechtman - Centennial, Colo.

1 Barry Armstrong - Needham, Mass.

2

Jeffery Townsend - Westminster, Colo.

2

3

Barry Armstrong - Needham, Mass.

3 Trudy Haussmann - Lake Forest, Calif.

Jeffery Townsend - Westminster, Colo.

4 Charlie Duncan - Carlsbad, Calif.

4 Jordan Dechtman - Centennial, Colo.

5 Graydon Coghlan - San Diego, Calif.

5 Graydon Coghlan - San Diego, Calif.

6 Kimberly Kropp - Omaha, Neb.

6 Charlie Duncan - Carlsbad, Calif.

7 Chuck Blossom - Lake Elmo, Minn.

7 John Egan - Madison, N.J.

8 Trudy Haussmann - Lake Forest, Calif.

8 Chuck Blossom - Lake Elmo, Minn.

9 Michael Mullis - Vestavia Hills, Ala.

9 Philip Deangelo - Highland, N.Y.

10 Jeff Conforti - Campbell, Calif.

10 Kimberly Kropp - Omaha, Neb.

11 Roger Smedley - Salt Lake City, Utah

11 Minoti Rajput - Southfield, Mich.

12 Minoti Rajput - Southfield, Mich.

12 John Porter - Evansville, Ind.

13 Paxton Farese - Ridgeland, Miss.

13 Roger Smedley - Salt Lake City, Utah

14 John Egan - Madison, N.J.

14 Lester Jackson - Park Ridge, Ill.

15 Philip Deangelo - Highland, N.Y.

15 Hugh Phillips - Napa, Calif.

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Top 15 Branch Offices 1 JFC Financial Services

Lincoln, Neb.

Jack Connealy, President, OSJ

9 M2 Wealth Management Group

Sacramento, Calif.

Richard Maxey, President, OSJ

2 KCL Service Company

Kansas City, Mo.

Kelly Ullom, OSJ

10 Queen City Financial Advisors

Cincinnati, Ohio

Chuck Hais, President, OSJ

3

11 Haussmann Financial

Lake Forest, Calif.

Trudy Haussmann, OSJ

L&M Financial Amherst, N.Y. Gregg Lipsitz, President Amy Lipsitz, CEO Joseph Lipsitz, OSJ

4 Cedar Brook Financial Partners

Mayfield Heights, Ohio

Bill Glubiak, Managing Principal, OSJ 5 Cooper McManus Wealth Management

Irvine, Calif.

Art Cooper, Managing Partner, OSJ 6 Investor Securities Group

Suffolk, Va.

Chris Holloway, President and CEO, OSJ 7 Navigation Financial Group

Dallas, Texas

Clyde Wyatt III, Managing Director, OSJ 8

USAdvisors Wealth Management Eden Prairie, Minn.

Nate Bergeland, Founder and CEO, OSJ

12 Iron Point Financial Advisors

Folsom, Calif.

Robert Santoriello, President and CEO, OSJ 13 EOI Management

Bismark, N.D.

David Paulson, OSJ 14 Dalton Strategic

Knightstown, Ind.

Steven Dalton, OSJ 15 Verus Capital Partners

Scottsdale, Ariz.

Steve Bull, OSJ

continued on page 17

MARCH 2016 | The STAR 16

Assistant of the Year Award Jennifer Nelson Diversified Wealth Management St. Louis Park, Minn.

Advisor - Todd Terhorst The recipient of this award is nominated by an advisor, has a minimum of two years’ experience in the financial services industry, has a clean compliance record if licensed and shows exemplary service above and beyond what is expected to clients, advisors and the firm.

The recipient demonstrates leadership abilities as well as personal and professional development.

NEW! Distinguished Principal Award Christina Wolfe L&M Financial Services Amherst, N.Y. OSJ - Joseph Lipsitz The recipient of this award demonstrates outstanding qualifications in advisor service, supervisory abilities, and a collaborative and positive attitude. Principals are nominated by home office employees and voted on by a panel of Securities America employees.

NEW! Exemplary Office Award Chuck Hais, OSJ Beth Hodges, Acting Principal Queen City Financial Advisors Cincinnati, Ohio This award recognizes an advisor office or branch office that is current on all compliance requirements, has no major audit deficiencies, and has a low number of surveillance risk items, CRIG findings and Consequent Management. Offices are nominated by home office employees and voted on by a panel of Securities America employees.

Shining Star Award Shannon Brusseau Diversified Wealth Management New Prague, Minn.

This award is based on the highest number of qualified advisors referred to Securities America in 2015.

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Shooting Star Awards Advisor AUM John Lindsey Christina Lindsey Orta Lindsey and Lindsey Wealth Management Westlake Village, Calif.

This award is presented to the advisor with the highest percentage increase in fee-based assets under management. The advisor must have an effective date prior to Jan. 1, 2014, and have a minimum of $10 million in assets under management.

Advisor GDC Rick Mootz Mootz Financial Solutions Paradise, Calif.

This award is presented to the advisor who has the highest percentage increase in gross commissions and fees. The advisor must have an effective date prior to Jan. 1, 2014, and have a minimum of $250,000 in GDC/fees.

Branch AUM LPF Financial Advisors Saratoga, Fla. OSJ - Mark Lurz This award is presented to the branch with the highest percentage increase in fee-based assets under management. The branch must have a minimum of $50 million in fee-based assets under management and a minimum of four advisors.

Branch GDC Yadkin Wealth Statesville, N.C. OSJ - Phyllis Polo This award is presented to the branch with the highest percentage increase in gross commissions and fees. The branch must have a minimum of $1 million in total GDC/fees and a minimum of four advisors.

MARCH 2016 | The STAR 18

Technology Notes

Securities America Technology News

by John Vipond

John Vipond is a product analyst with the Field Technology Group at Securities America. You can reach him at 800-747-6111, ext. 3336, or jvipond@saionline.com.

19 The STAR | MARCH 2016

Internet Explorer 10 No Longer Supported:

The change will provide a new look for all Webmail users. If you experience any email-related issues during the migration, please contact the Rep Technology Support Group for assistance. You will continue to receive updates through the daily e*Star.

In January, Microsoft stopped supporting Internet Explorer versions 10 or older and any future updates. As noted in the minimum system requirements, you must use Internet Explorer version 11 for the highest security level when using Business Center or Advantage.

Please remember to review these minimum requirements to help protect sensitive client information.

For assistance updating to Internet Explorer version 11, work with your IT professional or contact the Rep Technology Support Group.

National Financial and Pershing mobile check deposit apps have been used to deposit over $500 million.

If you can’t process a mobile check deposit, you must mail checks to the home office for deposit until the issue is resolved.

RSA Logo:

New Business Solutions:

The Securities America Business Center login page was updated to include the Secured by RSA logo.

This logo is a reminder that our site is protected by the highest level of security available from one of the most sophisticated and reliable companies in the industry.

Several new enhancements to New Business Solutions will improve efficiency by reducing the number of steps needed to complete common tasks. The list below includes just a few of the updates. For the full list of fixes and enhancements, go to SAI Release Notes under the News tab in Business Center.

Webmail/Exchange Server Updates: Securities America updated the advisor-facing email servers to improve functionality and increase security. Over the next few months, all advisors’ offices will have their email migrated to the new server.

Mobile Check Deposit Reminder:

• Add Account now includes pre-fill functionality from Account Manager prospects and leads.

When you enter the information in the client last name or entity field, the list of existing clients will include prospects and leads from Account Manager.

• You can now transmit new business paperwork directly from Status. Open any pending paperwork bundle and you will see a Transmit Paperwork button on the top tool bar. Click it to load the Vault and transmit your paperwork.

Once the transmission has been sent, you will see a transmittal received status on the bundle.

• Supervision review search screens now default to the previous search result. When you perform a search and click away, the results will continue to be displayed.

• The date when suitability data was last updated is now part of the OSJ and supervisory review screens on transactions.

• All Pershing Investment Club and IRA registration forms selected during the Add Account session, including system required forms, are loaded when you click the Print button.

• Any client record associated with an unresolved sponsor mismatch is no longer available for update in New Business Solutions via Update Account. Changes to these records are made using one of the available resolution options within Sponsor Mismatch from Status.

• The Managed Opportunities Client Agreement form now populates with the client Social Security number or tax ID from the Add Account session.

National Financial Updates:

drop-down box of financial institutions to access tax data or visit turbotax.com or hrblock.com for instructions on how to use these products, including how to import data from clearing firms. There will be no charge for this service, and the option will work for all active myStreetscape IDs when tax information is available.

Pershing Updates: • Pershing NetExchange Client® Sites Discontinued: Securities America migrated to NetXInvestor® in April 2014.

To ensure a smooth migration, clients who accessed the NetExchange Client or myedocumentsuite.com™ sites were automatically redirected to NetXInvestor. Clients were also provided instructions for accessing the new site and told how to update any bookmarked or saved site links. In January, Pershing removed the redirection and instructions, so you should remind clients the new site is netxinvestor.com.

• NetX360® Enhancement: Pershing’s latest update for NetX360 includes the return of the old menu bar. If you have updated NetX360, simply click on the menu drop-down in the header bar and click on the pin icon on the far right. Once you have done this, the full menu bar will be displayed on top of the open tabs.

If you would like to remove the full menu bar, just click on the pin icon again to return to the previous view.

• myStreetscape Tax Import Options: This year, Securities America has entitled all myStreetscape logins to send data to Turbo Tax or H&R Block software. Information will be available after 2016 tax processing is complete.

Clients should select National Financial from the

If you have questions regarding any information included here, contact the Rep Relations Center using your Business Center Webmail. Have an idea for a technology enhancement? Send a message to the Suggestion Box.

MARCH 2016 | The STAR 20

Technology

Take Advantage of these Technology Tips for a Less ‘Taxing’ Tax Season

by Aaron Spahr

Learn why these seven technology tools can make life easier for you and your clients during tax season.

Tax day is quickly approaching.

Many of your clients have already taken the time and effort to file their 2015 returns, while others will wait until the last minute. The good news is, there are more technology features available to help you and your clients than ever before. Keep reading to learn some tips and techniques you can use to support and guide your clients through this stressful time of year.

• National Financial Streetscape This powerful system is available to all advisors and assistants with National Financial accounts.

Streetscape will be your first stop for retrieving statements and tax documents when clients call your office for help. Don’t forget to periodically visit the Previous Sales/Realized Positions area of Streetscape to view longand short-term gains and losses and see if any activity might be appropriate.

• Streetscape Reports

Aaron Spahr is lead product consultant at Securities America.

You can reach him at 800-7474-6111, ext. 3331, or aspahr@saionline.com.

21 The STAR | MARCH 2016

A number of useful reports that can help you identify opportunities for your clients are available in the Reports area of Streetscape. The Cost Basis – Realized G-L Summary report shows a list of all taxable

accounts sorted by their realized gains and losses for the year.

The RMD report can help you monitor required distributions before the end of the year, and the Retirement Contributions YTD and Prior Year reports can help you quickly see your clients’ contributions.

• National Financial myStreetscape Clients can self-enroll for online access to their National Financial brokerage accounts by visiting http://www.mystreetscape.com and clicking the Register Now link. Clients can view statements and tax documents online and even register to receive them electronically to make sure they are delivered faster than postal mail.

• Pershing NetX360 Pershing provides NetX360 as a sophisticated system for accessing account and office information.

Pershing offices can use NetX360 to view or download statements, tax documents and other paperwork. Cost basis, realized gain-loss information and multiple tax planning reports are available on this powerful system.

• Pershing NetXInvestor Using the self-registration option on http://www.NetXInvestor.com, your clients can quickly gain online access to their Pershing account information, including statements and tax documents. By clicking the Go Paperless link, they can elect to receive email notifications for new documents.

• TurboTax and H&R Block Integration Clients with National Financial accounts and an active myStreetscape code can use the import features available in TurboTax and H&R Block tax software by searching for National Financial as their brokerage firm. Pershing clients can import tax data into TurboTax by searching for Pershing during the import process.

• New Business Solutions and Mobile Check Deposit Does your client still need to set up an account and make a prior year contribution?

The quickest way is to use the Add Account – Set-Up Account feature of New Business

Solutions. For both National Financial and Pershing accounts, New Business Solutions will create the account and provide an account number immediately. Once established, you can locate the account using the Streetscape or NetX360 mobile app and use the Mobile Check Deposit feature to get the contribution booked faster than ever before. Contact Fieldtech_Group@saionline.com for instructions on getting started with Mobile Check Deposit, but don’t wait until the last minute to become familiar with these tools – start today.

Tax season is a busy time of year for everyone.

Answering questions, providing documents and actively monitoring the progress of your clients’ account activity can be challenging. But don’t make these activities more difficult than they need to be.

View 2 Minute Tech Tips on Advisor Tax Tools or Client Tax Tools today. Take time now to learn more about the powerful systems available to you and your clients. By using these tools effectively, you can be the expert that helps your clients get through this taxing time of year.

MARCH 2016 | The STAR 22

Technology Training Resources

PEER FORUMS Learn best practices from offices across the country in our Peer Forums – or share your own insights. Find these forums in the Business Center.

Advisor Forum Assistant Forum Branch Manager Forum Financial Institutions Forum NextGen Advisor Forum

COMING SOON

NextLevel Graduates Forum

Quarterly Technology Update

Technology Forum

Technology enhancements and updates move at a fast pace. Stay on top of this ever-changing landscape by attending the Securities America Quarterly Technology Update webcast at the end of each quarter. We will highlight workstation enhancements, provide insight and showcase new tools and applications. Watch the daily e*Star and the Business Center events calendar for details.

Women Advisor Forum

ONLINE TRAINING MODULES New Business Solutions Vault For more quickcards, visit the Info tab of Advantage.

MOBILE CHECK DEPOSIT TIP

RELEASE NOTES

When taking pictures of checks for Mobile Check Deposit, remember to use proper lighting and a contrasting background. If the on-screen image appears blurry or out of focus, use the "retake" selection to try again. If you are unable to get a clear image of the check, please use backup procedures and mail the check to the home office for deposit.

Wondering what changed in the last system update? Read our release notes.

New Business Solutions Release Notes

23 The STAR | MARCH 2016

ONGOING TRAINING PROGRAMS

2 MINUTE TECH TIP VIDEOS

Fast Track Training

Funding Brokerage Accounts

This instructor-led training series helps advisors and administrative staff use Advantage to its full potential.

Learn how the Advantage Account Servicing tool can help you fund your National Financial or Pershing brokerage accounts faster and easier.

More info Calendar

Discover a simple way to submit documentation and review the status of your sponsor reimbursement requests. A new area of the Compliance tab makes this process easier than ever.

Assistant Certification

Sponsor Reimbursement Process

This introduction to Securities America and the financial services industry helps assistants take on greater responsibility. The program offers 24/7 access to industry-leading training without traveling or taking time away from the office. It is divided into seven tracks offering more than 35 courses. Each course includes a post test. A comprehensive final exam confirms mastery of the program content.

Managed Opportunities Desktop

More info

Give your clients the tools they need this tax season.Â

Sign up

Reduce the number of clicks it takes to initiate a proposal, start a service request or access your saved layouts. Minimize the effort it takes to accomplish these frequent tasks through the Managed Opportunities 2.0 desktop home screen.

The Benefits of Householding Learn how easy it is to create and use custom households to review information, learn about your clients and work more efficiently.

Client-Facing Technology for Tax Season

Technology for Tax Season Learn about the technology available to increase your office’s efficiency this tax season.

Securities America Events App Learn how to use this convenient app and get the most out of your conference experience.

Watch for more 2 Minute Tech Tip videos in the daily e*Star.

MARCH 2016 | The STAR 24

Practice Management

Make the First Friday of the Month Your Business Improvement Day

by Teri Heim

If you’re concerned or unsure how to improve an aspect of owning, managing, growing or exiting your business, be sure to take advantage of Securities America’s Practice Management First Friday Coaching.

Offered at no cost on the first Friday of each month, these 30-minute calls are an opportunity for you to receive personalized coaching and advice from an expert consultant with extensive experience running a financial services business.

Commonly addressed topics include: • Increasing expenses • Errors and client service failures • Inadequate systems or procedures • Difficulty achieving goals • Staffing issues such as low morale or high turnover • Continuity and succession planning concerns • Low client acquisition 2016 First Friday Coaching Dates: • April 1 • July 1 • Aug. 5

Teri Heim is first vice president of Business Growth Programs at Securities America.

You can reach her at 800-747-6111, ext. 5305, or theim@saionline.com.

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To schedule your First Friday Coaching call, contact Practice Management at 800-747-6111 xGROW (4769) or email us at PracticeManagement@saionline.com.

Virtual Meetings for Advisors In today’s technology-fueled world, it is becoming essential that advisors communicate with clients virtually. As your client base becomes larger, your time becomes more valuable and limited. Virtual meetings continue to gain widespread popularity as proxies for face-to-face meetings for two reasons: they expand an advisor’s geographical reach and serve clients in a more cost-effective manner. It’s a leverage play.

• Virtual meetings enable you to serve clients wherever it’s convenient for them, and wherever and whenever it’s convenient for you.

• Meeting virtually allows you to provide cost-effective service to current clients and to a range of clients you might not have considered serving in the past.

There are endless opportunities to grow your business once you are capable of hosting a virtual meeting anywhere there is an Internet or wireless connection.

Download the new Virtual Meeting guide today. It’s available on the Business Center under the Running Your Office tab. Contact Practice Management at PracticeManagement@saionline.com or 800-747-6111 xGROW (4769) with questions.

MARCH 2016 | The STAR 26

Practice Management

Providing a Safety Net Recognizing risks, some OSJs now offer built-in continuity and succession plans Without the protection of a continuity and succession plan, an advisor could be putting the fruits of a long career at risk when he or she retires, dies or is unable to work. But lacking the time, resources and know-how to develop these plans, many continue to operate without these valuable safety nets.

Knowing how challenging it can be for an advisor to come up with a plan that’s best for their clients, business partners and families, some OSJs and branches now offer standardized plans as a benefit of joining their firms. These can be continuity plans, which outline the arrangements for the operation of a business if the owner dies or becomes incapacitated; a succession plan, which details the sale of a firm when an advisor retires; or a single hybrid plan that covers all scenarios.

The lessons of that costly loss prompted Navigation Financial Group to offer a standard agreement to protect its advisors, their families and the OSJ. The agreement provides a transfer of the business in the event of an advisor’s death, permanent disability or retirement. It also helps determine the fair market value of a business and outlines the method of payment that will be used to make the purchase while enabling the new owner to work with clients after the sale is complete. Without a prearranged buyer, the OSJ will purchase the business and compensate the survivors.

Unfortunately for Navigation Financial Group in Dallas, Texas, it took a tragedy to realize the importance of offering its advisors a plan that covers succession and continuity.

While the plan ensures a business will be sold and a family will be paid, it doesn’t guarantee they’ll receive top dollar for the assets. The agreement was purposefully worded this way as incentive for advisors to seek out a more lucrative plan, Wyatt said. In some arrangements, he has funded a life insurance policy for a firm that pays the beneficiary — typically a partner or a junior advisor — the benefits needed to purchase an advisor’s business when he or she dies.

In 2001, one of the firm’s advisors died suddenly.

Without an agreement arranging for the sale of his business, his wife was left empty-handed. She then sued the OSJ for compensation.

Navigation Financial Group requires all advisors to sign the succession agreement or sign a document, with their spouse present, stating they are refusing to sign the offered agreement.

“Our brothers in the industry outside our firm smelled blood in the water and swooped in and got clients to sign a change of advisor form,” said Clyde Wyatt, the firm’s managing director. “In months, maybe weeks, his firm was gone.”

In addition to providing a much-needed safety net, having a built-in plan has benefitted recruiting efforts, Wyatt said. He recently signed on two advisors who both said the succession plan was a primary reason for joining the branch.

27 The STAR | MARCH 2016

Wyatt’s Plan Inspires California OSJ While serving with Wyatt on the Securities America Branch Manager Advisory Council, Art Cooper, managing director of Cooper McManus Wealth Management in Irvine, Calif., realized many advisors in his OSJ were also operating without the protection of succession and continuity plans. After speaking with Wyatt about the agreement offered

by Navigation Financial Group, Cooper adopted the same basic plan for use at his firm.

Under the Cooper McManus agreement, if a business needs to be sold due to the death, disability or retirement of an advisor, it will be offered to the successor for one times the verified trailing 12 months of revenue. The balance of the purchase price would be paid in equal monthly installments over three years.

The agreement helps a business live on after the owner is no longer in the picture, Cooper said, but it’s only meant to cover the basics. Like Wyatt, he encourages his advisors to find a more comprehensive plan on their own.

“It’s not ideal,” Cooper said. “We still encourage advisors to get a more formal agreement. This is a backup. It’s not meant to be a rich agreement.”

Even with a built-in plan, Cooper admits it’s still difficult to get buy-in from all advisors. Only about 20 of his 55 active producers have signed it. Of those who have not signed the agreement, just 10 have another agreement in place. So why don’t advisors take advantage of the plan?

Apathy and procrastination, Cooper said.

“They know they need to do it, but the default is to put it off and put it off and put it off,” he said.

That mindset commonly reverses as advisors reach their 60s and 70s, when they recognize the potential problems that could arise if they continue working into their golden years without a plan, Cooper said.

“The older advisors start feeling their mortality,” Cooper said. “That’s when they ask to have something in place to protect their spouse.”

Iron Point Plan Changes Recruiting Philosophy In 2010, Rob Santoriello, president and CEO of Iron Point Financial Advisors in Folsom, Calif., noticed many of the firm’s advisors were nearing retirement age without a succession or continuity plan. Foreseeing the potential for continued on page 29

MARCH 2016 | The STAR 28

costly problems, Santoriello approached Securities America’s Practice Management Department to help devise a solution. The answer was a standardized plan that combined agreements for succession and continuity and is available to all Iron Point advisors.

“We have a standardized OSJ continuity and succession plan for every one of our advisors,” Santoriello said. “If they don’t have one already, we can be their backup. If something happens to an advisor — they pass away or become disabled — a broker-dealer cannot pay their family members unless they are licensed. We step in to be the backstop. We purchase the practice.”

We have a standardized OSJ continuity and succession plan for every one of our advisors. If they don’t have one already, we can be their backup.

-Rob Santoriello Santoriello has witnessed firsthand how important it is for an advisor to decide who will oversee the practice when it’s time to step aside. In 2014, he purchased his business — formerly called Rios and Associates — from its founder, Richard Rios.

Over the past two years, seven Iron Point advisors have entered into a succession or continuity plan agreement, meaning their businesses are in the process of being bought or have already sold.

Having a plan has also changed the firm’s recruitment philosophy. To ensure it has enough young advisors ready to step in and purchase a business, it now focuses on attracting and retaining millennials.

29 The STAR | MARCH 2016

“We looked at our number of older advisors and saw that there wasn’t a lot of youth in the branch,” Santoriello said. “We have the bandwidth in the OSJ now to recruit younger advisors, to get them ready to do a practice acquisition and to get their house in order.”

Because many junior advisors are still building their books of business and are below the firm’s traditional production minimum, Santoriello said he’s had to rethink some of his recruiting standards. This shift in strategic priorities has proven successful.

“As we’ve moved to retain practices, we’ve brought in younger advisors who have worked to grow themselves,” Santoriello said. “If they were below the production minimum, but there were extenuating circumstances, and they were a millennial advisor who was doing all the right things, we still took a look at them. They’ve all benefitted from linking up with a senior advisor and creating a succession plan.”

From ensuring an advisor’s business legacy lives on, to compensating families and attracting the next generation of young advisors — many OSJs and branch offices are discovering the list of benefits that goes along with offering built-in continuity and succession plans far outweighs any time and effort spent developing them.

Continuity or Succession Plan? You Need Both.

Continuity and succession plans can be mistaken as interchangeable, but there are important differences you should be aware of when protecting your business’ future.

A continuity plan addresses the question: If I suddenly faced a long-term illness, permanent disability or death, who would take care of my clients and staff? It’s meant to ensure your business remains viable until you can return to work or your practice can be sold. Securities America encourages all advisors to have a continuity plan on file, so in an emergency, we know who to work with to care for your clients and ensure your family is taken care of.

A succession plan covers the details of the sale of your practice when you retire. Because a continuity plan addresses the unpredictable, it should be finalized before your succession plan. Some advisors use a single hybrid plan that covers both continuity and succession.

Continuity and Succession Planning Resources If you’re looking to get started on your continuity and succession plans, go to Continuity and Succession Resources under the Running Your Business tab in the Business Center. You’ll find easy-to-use tools to help determine the value of your business, structure a deal, develop agreements and more.

Securities America partners with FP Transition Services to provide practice valuations, continuity and succession planning services and a listing site of practices for sale. For more details, go to fptransitions.com.

Securities America’s parent company, Ladenburg Thalmann, offers a Practice Transition Listing Site with numerous resources to help you find a continuity partner, sell your practice or locate a practice for sale within the Ladenburg Thalmann family of independent broker-dealers.

MARCH 2016 | The STAR 30

Practice Management PART 1

Mentoring Helps Young Advisors Skip School of Hard Knocks Pilot program proved so successful, participation doubled for 2016 Twenty-four years ago, Chad Parmenter learned the financial industry ropes much the same way many new advisors still do today — through the often painful process of trial and error.

That education from the “school of hard knocks” paid off for the 48-year-old, who is now the lead advisor for Mirus Planning, the Washington firm he founded in 2009. Even though he looks back and laughs as he recalls the career challenges he had to overcome on his own, Parmenter said the newest generation of advisors would benefit more by having a seasoned veteran they could turn to for advice as they build up their business.

“This industry is in flux,” Parmenter said. “It’s constantly changing. When you’re building a practice and think you have it all figured out, something will change. It’s important to have someone who can help you through those ups and downs.”

So when Securities America Executive Vice President of Strategy and Practice Management Kirk Hulett approached Parmenter with a proposal to coach an up-and-comer as part of the company’s pilot Next Generation mentoring program, he jumped at the opportunity.

“It was something I could do to give back, so someone else could learn from my mistakes,” Parmenter said. “That way they don’t have to go out and learn those lessons on their own terms.”

31 The STAR | MARCH 2016

OF A TWO-PART SERIES highlighting Securities America’s Next Generation mentoring program

The idea for a mentoring program originated with requests from young advisors seeking opportunities to learn from their more experienced peers, said Jeff Sietstra, senior practice management consultant and the program’s coordinator.

“They wanted to tap into the experience of someone who has been there and done that,” Sietstra said.

“The mentors wanted to help the mentees go down the road and prevent them from making the same mistakes they made.”

To launch the program, six mentors and six mentees were paired for six months with the goal of fostering the next generation of advisors’ career growth through coaching, networking and sharing experiences.

Mentees were chosen by Practice Management to participate based on several criteria. Mentors were selected from advisors who were enrolled in the Masters Series study group and those who qualified for the Masters Forum.

Pairings were determined by a review of the business competency, experience, training or other needs a mentee identified on the application to participate in the program. Advisors who were paired together did not conduct business in the same geographical area to avoid conflicts caused by competition.

Participants attended a training session where expectations such as commitment and time

required were explained. Both parties also signed an agreement that included expectations of the mentor, learning and development goals for the mentee, a list of resources needed to achieve the goals, a tentative meeting schedule and a statement of confidentiality.

Practice Management provided mentors a monthly meeting guide with suggested discussion topics, a toolkit with preparation tips for coaching sessions and an assortment of “stretch assignments” designed to help the mentees grow in specific areas.

Each pair met by phone for a minimum of one hour per week. Sietstra also periodically called the participants to get an update on how the relationship was progressing and to offer guidance and support. The post-program feedback was so positive, Sietstra doubled the number of participants to 12 pairs this year. The latest six-month mentoring session kicked off Jan. 8.

Wesley Shields, 35-year-old co-owner of Synergy Financial Advisors in Utah, was matched up with Parmenter. Because the two shared a common business style and personality traits, Shields said he was able to make an immediate and lasting connection with his mentor.

“Chad and I view things with a comparable lens,” Shields said. “I’m not a hard-sell kind of guy. I believe if you do good things to others, good things will come back to you. That’s the way Chad is, too. We talked about a lot of things. I’d send him an email and say, ‘Here are my questions’ and that would spawn more questions.”

During their phone meetings, Parmenter shared his knowledge and experience regarding a broad range of topics including practice management, soft skills, retirement planning and asking for referrals. Shields said he kept a file of the ideas and suggestions they discussed and has already implemented some. He plans to reference the others for future projects.

While the conversations always yielded benefits, Shields said the most impactful coaching sessions were those that helped him develop a compelling 3-3-3 speech.

Typically crafted after an advisor establishes a value proposition, the 3-3-3 speech combines a three-second label that identifies who they are, a 30-second introduction that explains what they do and a three-minute explanation of how they do it. Advisors then use each of these components to clearly communicate the advantages of doing business with their practice.

“It was a turning point for me when Chad shared how to craft a 3-3-3 speech,” Shields said. “He talked me through the dynamics and why he has one. I was getting nowhere with my old 3-3-3 speech. I’ve always gone with the blunt approach of telling people I’m a financial advisor. That didn’t get me anywhere. Now I tell people I develop financial strategies that can help them avoid running out of money in retirement.”

While formal mentoring arrangements such as the Next Generation program are beneficial, opportunities to participate may be limited.

Parmenter urges new advisors to seek out an experienced professional who can guide them through the pitfalls of getting started. He also encourages seasoned advisors who are willing to share to seek out someone who could benefit from their experience. In the end, it’s sure to be a win for both participants, he said.

“I would say to anyone who likes to teach, it’s a great opportunity to mentor someone,” Parmenter said. “You just have to leave your ego at the door, understanding that there are a lot of smart people in this industry who run their business in a variety of ways. Everybody’s practice is different. But it’s a great way to share ideas while helping speed up someone’s success.”

Be sure to look for part two of the Next Gen Mentoring series in the May issue of the STAR to see how the unlikely pairing of a big-city New Jersey OSJ and a small-town Nebraska advisor benefited both participants.

MARCH 2016 | The STAR 32

Compliance

Are You Opening the Door for Hackers?

Common activities could leave your firm vulnerable to a cyberattack You might think the most common breaches of cybersecurity are from hackers who have devised a complex way to sneak onto your network through the “back door.” But the truth is, most businessrelated cybercrime is the result of employees unlocking the “front door” and inviting thieves in with seemingly innocent, everyday activities.

By surfing the Web, opening personal email or downloading information, images, games, videos and software, you and your staff could be hanging a welcome sign out for cybercriminals looking for an opportunity to access client data and assets, according to Cody Siebert, a financial advisor with Siebert & Briggs Wealth Management Advisors in Rosenberg, Texas, and the special interest group chief for the financial sector of Houston InfraGard Alliance.

Developed by the Department of Homeland Security, InfraGard is a partnership between the FBI and volunteers representing businesses, academic institutions, law enforcement agencies and other organizations. Members collaborate and share information to help prevent hostile acts against the United States. InfraGard recruits members like Siebert who have specific knowledge and skills that could benefit its security efforts.

“The largest cause of a cyberbreach or a hacking breach is actually the employees of the firm themselves,” Siebert said. “That’s your highest risk.

Because they assume going onto this website or that website wouldn’t be harmful. So what we have to

33 The STAR | MARCH 2016

do as advisors is really get firm and say, ‘You as an employee cannot go to any website unless it’s on the list of what we have approved. Period.’”

The largest cause of a cyberbreach or a hacking breach is actually the employees of the firm themselves.

That’s your highest risk.

-Cody Siebert When visiting websites, downloading information or opening emails, a staff member may unintentionally introduce a virus, malware or spyware that can allow a hacker access to your network.

Employees may also believe it’s harmless to read and respond to personal email on their personal cellphone or tablet while at work. But if they’re logged onto the office Wi-Fi, they could be creating an opening for thieves to sneak past your security measures.

“If they want to do something personally, even going to their own personal email can breach the entire firm,” Siebert said. “They should not be allowed to do that. Don’t even let them use the Wi-Fi in your office to get on their personal device, because all of that is breachable.”

It’s always wise to password protect your office Wi-Fi. If your staff would like to access personal information or the Internet, consider setting up a computer that isn’t connected to your office network for use during break times. Each year, staff members should sign a digital security policy as proof they understand your firm’s rules governing the use of technology.

Some simple, effective security measures you can put into practice immediately include setting computers to log off automatically after 15 minutes of inactivity and requiring all users to change their passwords every 60-90 days. Siebert recommends passwords include at least 10 characters.

“Anything eight characters or less can be hacked within 30 seconds or less with a free download program from the Internet,” she said.

Although it hasn’t happened yet, it’s only a matter of time before hackers develop a way to access your clients’ standing instructions and change a bank routing number to divert funds to another account, Siebert said. To ensure you’re not the first to fall victim to this type of theft, she recommends routinely verifying clients’ account numbers to make sure they haven’t been unknowingly changed. continued on page 35

MARCH 2016 | The STAR 34

Another easy step you can take to protect your clients is to simply get to know them better. By interacting with them more frequently, you and your staff will be able to recognize their voice when they call in to request a transaction.

Unless that assistant knows that’s the actual person on the other end of the phone, don’t accept the order.

Call that person back and confirm it.

As more and more business is conducted online and hackers continue to develop more sophisticated means for accessing sensitive information and pilfering funds, it’s vital for everyone in your office to stay informed of the latest threats and the measures they should take to protect your business and its clients.

For information about cybersecurity, protection from computer viruses, firewalls, email encryption and other tools you can use to protect your firm from cyberattack, go to the PC Support Center under the Info tab in Advantage.

-Cody Siebert “If the assistant doesn’t know that client’s voice, do not accept a withdrawal request,” she said.

“Because some accounts may already have standing instructions to just send cash; nothing needs to be signed. Unless that assistant knows that’s the actual person on the other end of the phone, don’t accept the order. Call that person back and confirm it.”

For information about cybersecurity, protection from computer viruses, firewalls, email encryption and other tools you can use to protect your firm from cyberattack, go to the PC Support Center under the Info tab in Advantage.

Additional information about cybercrime and steps you can take to protect your business is available from the Better Business Bureau and the U.S. Small Business Administration.

35 The STAR | MARCH 2016

Four Simple Steps to Help Protect Your Firm from Hackers Small business owners lose an average of $155,000 per year due to fraud, according to the Association of Certified Fraud Examiners. While not all that loss is directly linked to cybercrime, a significant portion does end up in the hands of hackers. To help protect your firm’s digital data from theft, the U.S. Small Business Administration recommends you take the following steps:

Educate your staff It’s vital to keep employees updated about the latest security threats and ways to protect information. Hold regular training sessions on how to keep confidential data secure, and review your office security policies.

Secure your IT infrastructure Invest in a firewall and software that detects viruses, malware and spyware.

Important data should be backed up at a secure off-site facility.

Use a dedicated computer for banking Set aside a computer to use for all your personal and business-related financial transactions. This computer should never be used for accessing social media sites, opening email or surfing the Web.

Implement a strict password policy Make it a rule that staff must change passwords every 60-90 days. Passwords should be complex (e.g., they must contain 10 characters and include one uppercase letter, one number and one symbol). Use different passwords for different accounts.

MARCH 2016 | The STAR 36

Spotlight

Kimberly Kropp Plans to Use FSI Board Position to Promote the Positive Nebraskan honored to bring advisor’s perspective to board of directors Kimberly Kropp believes the role financial advisors can play in a client’s life is often misunderstood by the public and misrepresented in the media. A few negative headlines circulating on the Internet is all it takes for some people to develop false impressions of the financial services industry, she said.

Having the opportunity to positively influence public perception and work directly with lawmakers in Washington, D.C., were the primary reasons Kropp, the owner of Moylan Kropp in Omaha, Neb., opted to join the Financial Services Institute (FSI) three years ago.

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Since then, she has played an active role in many of the organization’s interactions with legislators on Capitol Hill. In 2015, Kropp’s commitment to FSI and the industry earned her an appointment to the organization’s 18-member board of directors. Her term started in January.

Kropp said she’s honored to bring an advisor’s perspective to the board, which is primarily made up of industry executives. Richard Lampen, president and CEO of Securities America’s parent company Ladenburg Thalmann, serves as the board’s vice chairman.

FSI was founded in 2004 with the mission to ensure everyone has access to competent and affordable financial advice, products and services delivered by a growing network of independent financial advisors and independent financial services firms.

Over the past decade, some of the organization’s grassroots efforts have included: • Mobilizing advisors to collectively bring about change.

• Coordinating in-state meetings, letters and phone calls to elected officials.

• Working with members to garner support for advocacy efforts through the FSI PAC. • Holding over 260 meetings on Capitol Hill with members of Congress.

• Working with the media to influence the administration, Congress and regulators on the federal and state levels.

To ensure the public and the nation’s lawmakers get the truth about the profession, advisors need to be more proactive, Kropp said.

My goal is to get more involved on the board and to constantly work to make a positive impression.

pertinent issues facing the industry. They then take that information to Capitol Hill, where they meet for one-on-one discussions with lawmakers.

“Some of them know what we’re talking about, but others have no idea,” Kropp said. “They have so much on their plates. By getting in front of them, we can make them aware of issues and maybe put a positive twist on them in our favor.”

Kimberly Kropp, Moylan Kropp moylankropp.com

-Kimberly Kropp

“We have to get out there and talk about all the good we do,” she said. “I’m the one who has to call a family and tell them Mom has dementia. I’m at the hospital at the end of life. I’m the one who throws a retirement party. They think it’s all about the money, and it’s hard to change that. It’s not going to take one person, five people or a hundred. It’s going to take all of us.”

Changing perceptions of the financial services industry has become even more critical in light of plans from the Department of Labor and the Securities and Exchange Commission to introduce new fiduciary rules this year. Those rule changes could limit consumer access to retirement planning advice and dramatically change how advisors conduct business.

Showing the nation’s leaders and the public the positive impact financial advisors make in their clients’ lives and their communities will be at the heart of all her efforts while she serves on the FSI board, Kropp said.

“It’s going to be my ongoing goal to change the viewpoint of this profession and to show people who we are and what we do for our clients,” she said. “I hope to get more involved on the board and to constantly work to make a positive impression.”

As a board member, Kropp will travel to Washington four times per year. One of those trips will be each May for FSI’s Capitol Hill Day. At this annual event, members attend intensive training sessions regarding

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FSI Update

Looking Ahead at 2016: State Regulations and Legislation An overview of key regulatory and legislative initiatives unfolding at the state level that are affecting advisors.

Election years naturally draw the attention of the public, the media and members of our industry to national issues. This year, that pull is even stronger, with a major new rule from the Department of Labor poised to overhaul the definition of “fiduciary” under ERISA and make it tougher for independent advisors to provide the critical retirement advice Main Street Americans desperately need.

Even with so much focus shifting to the national stage, advisors need to remain aware of the regulatory and legislative initiatives unfolding in their own backyards, at the state level. The various measures being considered this year in states across the country present both opportunities and challenges that stand to impact advisors’ businesses in profound ways.

While there are too many regulatory and legislative measures under way in the states to discuss in detail here, we grouped the key initiatives under the following headings:

Brought to you by The Financial Services Institute. For more information or to become a member, go to www.financialservices.org.

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1. Bills to Create State-Run Retirement Plans for Private Sector Workers: States across the country are moving quickly to pass legislation that could bring significant changes

to the market for retirement plan advice and services. While FSI shares state lawmakers’ concerns regarding American workers’ retirement readiness, the template on which most of these proposals are built — the so-called “secure choice” model — is simply not a good deal for workers or for the states.

“Secure choice” bills would require employers to enroll workers in a state-run IRA plan if the employers do not offer a plan themselves, with employees having the ability to opt out. Such plans would increase costs for state governments, create new expenses for small businesses, deny investors access to professional retirement advice and undermine financial advisors who have been providing expert retirement advice to investors and employers for decades.

We are happy to report that, thanks in part to the enthusiastic response of FSI members to our call to action in New Jersey, a “secure choice” proposal in that state was recently conditionally vetoed by Gov. Chris Christie.

We wholeheartedly support Gov. Christie’s counter-proposal, which

encouraged state legislators to re-draft the bill to implement a marketplace that would link workers with existing retirement plan options, similar to the system that has been implemented in Washington state.

seniors. Last year, we were happy to contribute to the passage of bills in Missouri and Delaware that strengthened protections for senior investors and another in Montana that increased penalties for those who financially exploit the elderly.

While Gov. Christie’s veto of the New Jersey bill is good news for taxpayers, investors and advisors alike, members of our industry should be alert to the fact that such bills remain under consideration elsewhere. In 2015, proposals to create “secure choice” plans were introduced in 25 states; some of these could return in 2016. Similar bills have been introduced in three additional states so far this year.

We would encourage all independent financial advisors to seek out similar opportunities to contribute to this crucial fight and to demonstrate our industry’s solidarity with state lawmakers and regulators on this issue.

2. Preventing Financial Abuse of Elderly Clients: While national self-regulatory organizations and laws are likely to govern some elements of the fight to prevent financial abuse of elderly clients, the primary drivers in this battle will be state governments and regulators.

With this in mind, members of our industry have an excellent opportunity to demonstrate their commitment to combating scams and fraudulent behavior that target our seniors by reaching out to state lawmakers and regulators to act as resources as they develop bills and rule proposals on this issue.

FSI is grateful to the North American Securities Administrators Association for allowing us to serve on the Advisory Council to its Committee on Senior Issues and Diminished Capacity. As the committee seeks to develop a model rule that will guide state regulators in propagating their own state-level measures on this issue later this year, we have been pleased to lend our perspective to this collaborative effort to protect our honored

3. Taxes on Financial Advice and Services: It seems that as long as states face budget shortfalls, proposals to create new taxes on financial advice and services will keep coming back. In 2015, we saw efforts to incorporate such taxes into state budgets in Pennsylvania and Maine. In Pennsylvania’s case, the new tax could have amounted to an egregious 6.6 percent for advisors, wiping out or significantly narrowing their businesses’ already slim margins.

FSI was able to work with our members and legislators to defeat these proposals last year, and to win repeal of a duplicative occupation tax on financial services professionals in Texas. Advisors and other industry professionals should not let their guard down, however, as history suggests that similar tax initiatives will emerge in 2016 as well.

This overview is just a sample of the numerous bills and rule proposals that are expected to come up for consideration in 2016. Financial advisors and other members of our industry will be wellserved to keep an eye on regulatory and legislative developments in their states this year and to work with us to protect their businesses and their clients’ access to their advice.

Take action to protect your business and your clients’ access to your advice.

Learn more at www.financialservices.org/famembership.

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