Making the leap to IIROC (Part 2)

The first three months: The good, the bad, the ugly and the paperwork

In the previous article I shared the rationale of our decision to move from the MFDA to IIROC. Part Two will go through the nuts and bolts of the move and how things are now that the dust has settled.

It’s official, we have no clients

Changing platforms is exciting and strange when you realize you now have no clients. Until you transfer your clients over, you are like a farmer with no land. First things first, you need to transfer your registration over to IIROC. One word of caution, it can take anywhere from 5 to 10 business days to move from MFDA to IIROC. There is no meeting with clients and signing transfer documents until you are licensed. We were very fortunate to have the best MFDA dealer around who offered to help in any way to make our transition smooth. They were outstanding as was our new dealership.

Before we changed dealerships we contacted all of our clients and scheduled hourly appointments each and every day starting 2 weeks after our transfer.

In order to prepare for the onslaught of meetings, we trained and prepared the paperwork during the registration transfer period. Our new dealer, Raymond James, sent out a specialist from their transition team for the first week. The specialist brought us up to speed on the new systems, compliance, documentation, etc.

The bad: Oh, the paperwork

Never have I killed so many trees

The new system made opening accounts very easy but the paperwork was incredible. Because we have always focused on financial planning, the majority of our clients had RRSP, OPEN, ITF, RESP and TFSA accounts and because we had always worked with client-held accounts we had almost a thousand individual accounts to transfer over – this and we only had 130 households!

As per the advice of our Raymond James specialist, we had pre-ordered thousands of “Sign here” stickers as well as boxes of paper and extra toner for the printer.

Our boardroom became a war room of client documentation and we set up a system akin to a factory production line where each area had its specific part in the workflow process.

The good: Client meetings

One per hour, every hour, every day, for almost 2 weeks

Our client meetings began and while clients were blown away by how much paperwork they had to sign, the years of trust and comfort paid off as we were able to walk through everything during the allotted time. Because we thought it would be nice to create more paperwork, we also took advantage of our time with our clients to restructure client portfolios as there had been quite a few management changes over the last year or so. During our meetings, there were still some questions on how fee-based planning worked and who Raymond James was but we were able to cover these questions within the hour.

By the end of the second week, we had signed account forms for over 60% of our book of business and the assets had already begun showing up at Raymond James.

The ugly: The hours

Sleep deprivation sets in

I have two young children, so sleep deprivation is part of life but add in working through the night and now you’re talking partial hallucinations! When you make the decision to move from the MFDA to IIROC be ready to commit a significant amount of time to the transition. We hired an extra administrator for the first 2 months to give us an another body to process the volume and verify each and every transaction. During the process don’t let yourself be distracted by anything other than transition issues and work. Everything else can wait. You just have to buckle down and get it done.

The great: Three months later

We are on the other side and we have clients

We have now been IIROC licensed for 3 months and have completed our 90-day training program and are fully securities licensed. First impressions? The systems are excellent. It is so much easier to set up new accounts. Nominee accounts are much better. Trades are much more efficient with verbal authority versus signed documentation and clients are thrilled with Raymond James statements, the online statements and information. There have been a few minor hiccups along the way but nothing significant that I’ll remember in a few months from now.

Mathieu, my colleague, and Diane, our branch administrator, set a goal to transfer 90% of our assets within the first three months, thanks in part to the transfer team at Raymond James. To date, we have transferred over 97% of our client assets and are waiting on only 3 households to sign their documents.

We have already had requests from clients who currently hold stocks or bonds to transfer the assets over. Our original mandate was to be able to offer any and all products that may benefit a client and to have a fee-based platform from which to work. Now, under the fee-based model, we are no longer compensated by the product provider and earn the same amount regardless of what the client invests in. It is a fantastic feeling. It actually feels like we are finally in the big leagues.

I have no regrets about the transition and wish I would have done it sooner in my career. For those thinking about making the move, my advice would be as follows: Make sure you are making the move for the right reasons. There is nothing at all wrong with the MFDA platform for most advisors. However, if you want to be able to offer the most unbiased advice and need a fee-based solution for your practice, then it’s not really a matter of should you do so, it’s just a matter of when you will. Best of luck.

Robert Abboud, CFP, PFP, is the co-founder of AdvisorPractice.com, which offers advisors practical solutions to help transition to a financial planning practice and offers a 12 week training program. He is also the author of ‘No Regrets, A Common Sense Guide to Achieving and Affording Your Life Goals’. He has been offering life goals financial plans for over 15 years through his firm Wealth Strategies. Robert is available to speak at conferences and educational days. You can contact him at rob@wealthstrategies.com.