IPI has developed two (2) new account forms to better serve your clients in gathering financial data and understanding their goals. As you can surmise,
there are regulations relative to instituting these new account forms as discussed further below. The fillable new account forms may be accessed on
the Advisor site under the Broker/Dealer tab and then the Documents tab or by clicking the following links:
The two (2) separate new account forms (IPI RBC New Account Form and IPI New Account Form) were developed to ease the confusion as it relates to opening
accounts for direct business, insurance, alternatives, variable annuities, etc., as references to RBC are not relevant to all investments at IPI. Please
note that in opening a RBC account, advisors are required to provide clients with the RBC Disclosures found at the bottom of the Clearing Platform
page on the Advisor site under Additional RBC CS Information.
As previously advised, an IPI New Account Form is required to be submitted with each new investment (non-RBC) as a client’s investment profile may change
depending on the investment, regardless if the client has a new account form already on file for another investment or account.
Use of the two (2) updated New Account Forms will be required effective January 1, 2014.
FINRA Rule 2111
Suitability FINRA Rule 2111 (Suitability) requires that a transaction recommended by an advisor be suitable for clients. This includes an advisor’s
analysis and review of a client’s (1) age; (2) investment experience; (3) time horizon for the investment; (4) liquidity needs; (5) risk tolerance
(6) and any other information the client may disclose to the advisor in connection with a recommendation. Additionally, it includes three (3) suitability
obligations for an advisor to consider before making a recommendation:
Reasonable basis suitability – advisors must perform their own reasonable due diligence to understand the investment or strategy recommended to
a client. This includes the potential risks and rewards of the investment.
Customer specific suitability – advisors must have a reasonable basis to believe that the investment or strategy is suitable for a particular client
based on the client’s investment profile.
Quantitative suitability – advisors must have a reasonable belief that a series of recommended transactions are not excessive.
In this Rule, FINRA has also broadened the definition of investment strategy to include hold recommendations, if the hold recommendation is explicit with
the client (i.e. you recommend directly to a client to hold a particular investment). Per Rule 2111, you are required to document the hold recommendation
in writing. IPI recommends that this required documentation be completed in Salesforce or in your contemporaneous notes maintained for the specific
Please direct all questions or replies to:
Renee Emrick, Esq. | Chief Compliance Officer/General Counsel Investment Planners, Inc.
226 W. Eldorado St., P.O. Box 170, Decatur IL 62525
217.542.1220 | firstname.lastname@example.org | Integrity Performance Innovation