I have been watching and having a good time. Glad to see an insider admit

that the ethics of this firm are something to laugh about.

Spiked has made some very interesting comments. Let’s hear some more.   I

noticed Hartford contributed more towards revenue sharing last year. I

would like for Spiked to comment on anyone that he knows that moved their

entire book of business over to Hartford.

[quote=spikedkoolaid]

I find it amazing that there are no EDJ reps in this forum suggesting that I'm saying something that is not true. 

[/quote]

Um, I just called you a liar, don't you remember?  It's right up there.

All you have done is admit that you have no ethics and allege that everyone else at Jones must be the same way. 

[quote=The Truth] I
would like for Spiked to comment on anyone that he knows that moved their
entire book of business over to Hartford. [/quote]

Why wait for spiked to make it up, just say you know of someone who did.  Kind of like that conversation you had with the imaginary client about the free switch (months before the letter actually went out, though.)

[quote=spikedkoolaid]

I find it amazing that there are no EDJ reps in this forum suggesting that I’m saying something that is not true.  In regions all over the country people are teaching IR’s how to, “get paid.” 

Here's another one.  If you have $250,000 to invest you can justify to the Field Supervisor to buy two separate a-share annuities at $85,000 each.  Then you put the other $80,000 in a fund family that is not represented in the VA's.  Basically you tell the Field Supervisor that you are using the living benefit with Hartford or American and then you use Protective (because they are the low cost provider) for tax deffered growth.  The field supervisor just likes the fact that you are using the a-share.

Many secrets soon to be revealed....stay tuned!

Yup. This is true. For instance if your sub accounts are in American Funds, they count toward other American Fund breakpoint purchases

JonesNewbie,

Please remember the point I am trying to make.  I'm not suggesting that every Jones IR does what I did.  What I'm suggesting is the Top Producers are doing it.  Jones rewards mediocrity.  The Top Producers have figured out in order to, "get paid" they have to be a little creative.  I'm not even suggesting that I hurt my clients by doing this.  What I'm saying is it's common practice to skirt around breakpoints so you can receive a higher payout.  Now that I'm at an Indy firm I don't have to worry about the payout because I'm getting a 90% split. 

Let's do the math:

$100,000 Mutual Fund Trade

3500 to the concession, times 40% is $1200.

If you do $85,000 at 4.5 you get $1530 plus

$15,000 into a Municipal Unit Trust 4.5 you get $225.  Total $1755.

At an Indy firm I make $3500 commission - 10% to the firm. $3150 to me.  I don't have to play these games.  I'm always doing what's right for the client.  It's easier to do what's right for the client when you are earning a 90% payout.

If you work the numbers as they get bigger the spreads get bigger.  Believe me fellas/ladies, this is a learned skilled not taught at Jones but learned at Div Trips over a couple of beers or through your mentor when they wink at you.

I just thought of another one we used to do.  Lord Abbett Bond Debenture (lbndx) fund pays 4% dealer concession up to $100,000.  So let’s say you had a $175,000 rollover and the client needed some income, you would put $85,000k in LBNDX and then put the other $90,000 in another fund family.  This way you didn’t have to hit the 100k bkpt.  You could explain it to your field supervisor that the Lord Abbett folks have this great(not so) bond fund and I want to use them for income and then the other fund family I would use for growth of the portfolio.  There will be more to come as I think about them…

As for people changing their whole book to Hartford.  I do remember that when Hartford first hit the Jones system, guys were getting paid 2% up front in C-Shares with a 1% trail.  They made Hartford cut this program out because “so much money was flowing to Hartford in C-Shares Jones didn’t like it.” I heard that comment straight from Uncle Tom Miltenberger while we were waiting for a plane on our way back from Tahiti. They want people to use A-Shares.  I also remember Top Producers using Hartford strictly because it helped their P and L.  I think the new way Jones credits their Revenue Sharing, IR’s will be less likely to sell a fund family because it doesn’t matter in regards to helping their P&L.

[quote=rankstocks]

spikedkoolaid,

     Congratulations! I'm glad you made the change.  Sounds like you'll be happier.  But which is it, 7 or 8 years at Jones?  540k gross off 54 million?  That's a 100bp turn on your book.  Wow! You must have been a churning machine. Independent will be a much better fit.

    Now you can turn even higher ratios on your book.  Indexed annuities at 12%, variable annuities as high as 8%, wrap accounts at 1.5%, managed money at 2.5%, junk bonds at 5%.  I'm sure you'll do the right thing for the you...er, I mean the client......or maybe that's why you're independent now.

    Too many FSPENDS, no wonder you left.  You have done some of the most unethical sales practices I can imaging on unsuspecting people, I'm guessing when you change firms and have even more free reign you will stop?  No, probably not.  I'm sorry your region had some unethical brokers, just make sure you take them with you when you move the LPL. 

    Let me know how those indexed annuities work out for your clients

[/quote]

Let me respond RankStocks!  During my audits, my auditer used to ask me the same thing about $54,000,000 and $540,000 Gross.  I have told you that I was in the top 10 in the firm in fixed income UIT's.  That's 4 to 4.5% no breakpoints.  I was in the top 10 in the company at selling Long Term Care Insurance.  I was on conference calls teaching others how to sell LTC.  I was also in the top 30 for the Managed Account Program.  So my book was well diversified and my annuity business was only 2% of my entire book when I left.  I think you are so upset at me because I am exposing some small ethical things that are taught by Jones Top Producers. 

I have a suggestion, next time you are at a Div trip or at a Regional Meeting, Ask a Top Producer in your region this question, "If a $1,000,000 rollover came in to the office how would you place the money."  I will wait for your answer this summer after the regional meetings. 

[quote=spikedkoolaid]

At an Indy firm I make $3500 commission - 10% to the firm. $3150 to me.  I don't have to play these games.  I'm always doing what's right for the client.  It's easier to do what's right for the client when you are earning a 90% payout.

[/quote]

How is this unique to Jones?  Every B/D takes there cut.  Are you trying to say that only the indies have ethics?

It will depend on that cut, though.  Some charge more, some charge less.  Jones has historically been fairly consistent (from my understanding) with wirehouses.  They are behind the 8-ball when it comes to regionals and independents, especially. 

You Jones people haven't heard the point I am trying to make.  Maybe I'm not a very good writer.  What I am trying to say is the fee based program allows an advisor to not have to skate around breakpoints in order to make money.  The reason it is unique to Jones is because there are IR's out there that know how to work the system/FieldSupervision/Jeremy Michaelman so that they don't have to hit breakpoints in order to make more commissions because they don't have a fee based program that is available to the IR's. 

I'll bet that if Jones offered a fee based program other than MAP, they would not have productive IR's leaving.  It sounds like you are new to Jones.  Jones is a great place to start, but once you start building your business you will see the light and stop drinking the koolaid. 

[quote=joedabrkr] [quote=spikedkoolaid]

I find it amazing that there are no EDJ reps in this forum suggesting that I'm saying something that is not true.  In regions all over the country people are teaching IR's how to, "get paid." 

Here's another one.  If you have $250,000 to invest you can justify to the Field Supervisor to buy two separate a-share annuities at $85,000 each.  Then you put the other $80,000 in a fund family that is not represented in the VA's.  Basically you tell the Field Supervisor that you are using the living benefit with Hartford or American and then you use Protective (because they are the low cost provider) for tax deffered growth.  The field supervisor just likes the fact that you are using the a-share.

Many secrets soon to be revealed....stay tuned!

[/quote]

I've seen several references to the fact that apparently at Jones VA subaccounts are counted as assets towards breakpoints with mutual funds purchases.  Maybe I've just missed something, but over 14 years with three wirehouses, and now indy, I've never seen anything like this.

Is this a practice that is unique to Jones?  A new development in the industry that I just plain missed?  Please fill me in here folks!
[/quote]

Joe - It's my understanding it's because Jones offers the 'A' Share annuity. Something my rep sold alot of. I doubt if this is industry wide, just Jones specific. However, different insurance companies allow specific funds to count towards breakpoint on the A share annuity and vice versa. I know Lord Abbett was very liberal in allowing funds inside annuities to count towards breakpoint (or at least they were in our case 90% of the time) American Funds? not so much.

[quote=rankstocks]

spikedkoolaid,

     Congratulations! I'm glad you made the change.  Sounds like you'll be happier.  But which is it, 7 or 8 years at Jones?  540k gross off 54 million?  That's a 100bp turn on your book.  Wow! You must have been a churning machine. Independent will be a much better fit.

    Now you can turn even higher ratios on your book.  Indexed annuities at 12%, variable annuities as high as 8%, wrap accounts at 1.5%, managed money at 2.5%, junk bonds at 5%.  I'm sure you'll do the right thing for the you...er, I mean the client......or maybe that's why you're independent now.

    Too many FSPENDS, no wonder you left.  You have done some of the most unethical sales practices I can imaging on unsuspecting people, I'm guessing when you change firms and have even more free reign you will stop?  No, probably not.  I'm sorry your region had some unethical brokers, just make sure you take them with you when you move the LPL. 

    Let me know how those indexed annuities work out for your clients

[/quote]

Rank,

I object to the absolute piety of your statements. Challenging one person's ethics is one thing, however you are insinuating that everyone who doesn't work for Jones has poor ethics and is commission driven. (coincidental considering Jones only offers the MAP program and all other investments offered are on commission basis only)

If anything, as an independent one is more cautious in what one does knowing if any issue should arrise he/she has to stand on her own feet and defend his/her actions. Being independent does not mean running wild in the streets - there are rules to adhere to just like you have at Jones. Working as independent Spiked either has obtained a 24 to supervise himself, or works closely under an OSJ with a 24.

Your implication that only Edward Jones IR's have their clients best interests at heart is a true example of the arrogance that lingers at Jones, and is what's causing Senior Vets to leave in droves.

[quote=Devoted SA][quote=rankstocks]

spikedkoolaid,

     Congratulations! I'm glad you made the change.  Sounds like you'll be happier.  But which is it, 7 or 8 years at Jones?  540k gross off 54 million?  That's a 100bp turn on your book.  Wow! You must have been a churning machine. Independent will be a much better fit.

    Now you can turn even higher ratios on your book.  Indexed annuities at 12%, variable annuities as high as 8%, wrap accounts at 1.5%, managed money at 2.5%, junk bonds at 5%.  I'm sure you'll do the right thing for the you...er, I mean the client......or maybe that's why you're independent now.

    Too many FSPENDS, no wonder you left.  You have done some of the most unethical sales practices I can imaging on unsuspecting people, I'm guessing when you change firms and have even more free reign you will stop?  No, probably not.  I'm sorry your region had some unethical brokers, just make sure you take them with you when you move the LPL. 

    Let me know how those indexed annuities work out for your clients

[/quote]

Rank,

I object to the absolute piety of your statements. Challenging one person's ethics is one thing, however you are insinuating that everyone who doesn't work for Jones has poor ethics and is commission driven. (coincidental considering Jones only offers the MAP program and all other investments offered are on commission basis only)

If anything, as an independent one is more cautious in what one does knowing if any issue should arrise he/she has to stand on her own feet and defend his/her actions. Being independent does not mean running wild in the streets - there are rules to adhere to just like you have at Jones. Working as independent Spiked either has obtained a 24 to supervise himself, or works closely under an OSJ with a 24.

Your implication that only Edward Jones IR's have their clients best interests at heart is a true example of the arrogance that lingers at Jones, and is what's causing Senior Vets to leave in droves.

[/quote]

Looks to me like Rank was attacking Spiked and wasn't insuating anything else.  Mostly based on what he has written here.  Seems like your a little touchy on this one.

correction insinuating

How is this unique to Jones?  Every B/D takes there cut.  Are you trying to say that only the indies have ethics?

Of course they do, otherwise we would have no back office support, research etc.  The difference is that as an independent receiving 90% of the commission AND not having a monkey on our back (St Louis and GPs) to produce an arbitrary amount each day, the independent can be more able to consider the client first.  The revenue will follow.  This isn't to say that all independents are ethical and don't consider their own pocket first or that reps at EDJ are not ethical.  It is that in the system of commission targets or you are canned versus fee based or independent with a higher pay out, one tends to reward the rep for churning and structuring the trades to get more revenue not in the best interest of the client.

As an independent, obviously I need to make money or I can't eat.  The fact that in my first year out from Jones I more than doubled my NET with less activity in my clients accounts is telling. 

You Jones people haven't heard the point I am trying to make.  Maybe I'm not a very good writer.  What I am trying to say is the fee based program allows an advisor to not have to skate around breakpoints in order to make money. 

You are writing very clearly. The Jones people have severe reading comprehension problems.  Probably from wearing those blinders.

Joe - It's my understanding it's because Jones offers the 'A' Share annuity. Something my rep sold alot of. I doubt if this is industry wide, just Jones specific. However, different insurance companies allow specific funds to count towards breakpoint on the A share annuity and vice versa. I know Lord Abbett was very liberal in allowing funds inside annuities to count towards breakpoint (or at least they were in our case 90% of the time) American Funds? not so much.

[/quote]

What has happened w/ your A share annuities since going Indy? Can you add more client money? Any client issues w/ these? I presume you can not still offer them?

CIB

I forgot to mention on my last post that before I left I didn't receive an FSPEND (for none jonesies that's a term used by Jones that requires the broker to give an explanation of a trade that was made) for 6 months.  Because I had over $12,000,000 in the Managed Account Program I never received an FSPEND.  BTW when the whole Revenue Sharing thing was on the front page of the WSJ and the LaTimes I could go to my best clients who were in the Seperately Managed Accounts and say their was no conflict of interest.  It was tough trying to explain to my mutual fund clients why I had used only preferred vendors.  I'm so glad I used the MAP (fee-based program) at Jones while I was there because of the $12,000,000 I had at Jones $10,000,000 has transferred in 9 weeks.  The other $2,000,000 will be coming in the next two weeks.  100% of the MAP clients are coming with me.  I'm so Happy!