A Working Group convened by the North American Securities Administrators Association (NASAA) in 2014 developed a model fee schedule and related accessibility guidelines to help investors better understand and compare various broker-dealer service and maintenance-related fees. The model fee schedule and guidelines make fee disclosure easily accessible and transparent for retail investors to understand and compare fees.
The Working Group was formed following the release of a study by NASAA’s Broker-Dealer Section uncovering a wide disparity in how broker-dealers disclose the fees they charge customers. The group consisted of state securities regulators, representatives of the Financial Industry Regulatory Authority (FINRA), the Securities Industry and Financial Markets Association (SIFMA), the Financial Services Institute (FSI), LPL Financial LLC, Morgan Stanley Smith Barney LLC, Prospera Financial Services, and Signator Investors, Inc.
The model fee schedule can be customized to be consistent with a firm’s branding and should include all miscellaneous account and service fees, including account maintenance fees. The schedule does not, however, include commissions, mark-ups, commission equivalents, or advisory fees.
After the development of the model fee schedule, thirty firms confirmed to NASAA that they had adopted and implemented both the model fee schedule and related accessibility guidelines. Investors are encouraged to ask their financial institutions whether they have adopted the model fee disclosure.
NASAA has provided this information as a service to investors. It is neither a legal interpretation, nor an endorsement of the listed firms, nor an indication of a policy position by NASAA or any of its members, the state and provincial securities regulators. If you have questions concerning the meaning or application of a particular state law or rule or regulation, or a NASAA model rule, statement of policy or other materials, please consult with an attorney who specializes in securities law.