Siebert Financial Profile
Siebert Financial Corp. (Siebert), together with its subsidiaries, operates as a diversified financial services firm.
The company provides a full range of brokerage and financial advisory services, including securities brokerage, investment advisory and insurance offerings, and corporate stock plan administration solutions.
The company conducts the following lines of business through its wholly-owned and majority-owned subsidiaries:
Muriel Siebert & Co., Inc. (‘MSCO’) provides retail brokerage services. MSCO is a Delaware corporation and broker-dealer registered with the Securities and Exchange Commission (‘SEC’) under the Securities Exchange Act of 1934 (‘Exchange Act’) and the Commodity Exchange Act of 1936, and member of the Financial Industry Regulatory Authority (‘FINRA’), the New York Stock Exchange (‘NYSE’), the Securities Investor Protection Corporation (‘SIPC’), Euroclear, and the National Futures Association (‘NFA’).
Siebert AdvisorNXT, Inc. (‘SNXT’) provides investment advisory services. SNXT is a New York corporation registered with the SEC as a Registered Investment Advisor (‘RIA’) under the Investment Advisers Act of 1940 (‘Advisers Act’).
Park Wilshire Companies, Inc. (‘PW’) provides insurance services. PW is a Texas corporation and licensed insurance agency.
Siebert Technologies, LLC. (‘STCH’) provides robo-advisory technology development. STCH is a Nevada limited liability company.
RISE Financial Services, LLC, (‘RISE’) is a Delaware limited liability company and a broker-dealer registered with the SEC and NFA.
StockCross Digital Solutions, Ltd. (‘STXD’) is an inactive subsidiary headquartered in Bermuda.
Subsidiaries and Business Offerings
Muriel Siebert & Co., Inc.
MSCO provides online and traditional discount brokerage services to clients.
In May 2022, MSCO received approval to expand its clearing services in the U.S. by acting as a correspondent clearing firm for institutional and online broker-dealers, registered investment advisors and other asset managers.
MSCO offers a wide range of products and services and is the primary subsidiary of Siebert.
Products and Services: Self-directed trading, market making and fixed income investments, stock borrow / stock loan, equity compensation plans (Siebert Corporate Services), and wealth management / financial advice.
Brokerage and Related Services
MSCO offers a wide selection of quality investment services, including broker assisted trades and free online self-service features such as real time quotes, market data, and trading tools.
MSCO is a self-clearing broker-dealer and also clears with National Financial Services Corp. (‘NFS’), a wholly-owned subsidiary of FMR, LLC.
Securities Finance and Market Making
The company makes markets in multiple exchanges and in over 2,000 equity securities and fixed income products. The client service offerings within the company’s Market Making division have evolved with capital markets and different trading strategies.
The company operates its Securities Finance Group, a division which consists primarily of the company’s stock borrow / stock loan and related services.
Corporate Services
The company is dedicated to helping publicly traded companies and their employees manage their equity compensation plans. Corporate services is a key component of the company’s business, and the company leverages its technology partnerships to create a distinct advantage through FIX connection trading and real-time transaction reporting. The company’s corporate services offering primarily supports small and mid-cap public companies.
Independent Retail Execution Services
MSCO and its clearing firms monitor order flow in efforts to ensure that customers are getting the best possible trade executions. All equity orders are routed in a manner intended to afford MSCO’s customers the most favorable terms on all orders. MSCO also offers customers execution services through various market centers for an additional fee, providing customers access to numerous market centers before and after regular market hours. Customers may buy or sell fixed income securities, municipal bonds, corporate bonds, mortgage-backed securities, government sponsored enterprises, unit investment trusts, mutual funds, certificates of deposit, and other securities. These transactions are serviced by MSCO’s registered representatives.
Retail Customer Service
MSCO’s superior customer service enhances its ability to compete with larger brokerage firms and provides retail customers with personal service via access to dedicated customer service personnel for all of its products and services. Customer service personnel, located in MSCO’s branch offices, are cross trained to assist with all clients’ needs for a reliable experience. MSCO uses a variety of customer relationship management systems that enables representatives in any location to review and respond to customers’ requests in a timely manner.
Retirement Accounts
MSCO offers customers a variety of self-directed retirement accounts. Each IRA, SEP IRA, ROTH IRA, and KEOGH account can be invested in a variety of qualified investments in a consolidated account. MSCO acts as its own custodian for retirement accounts and also utilizes NFS for IRA custody. MSCO offers self-directed retirement accounts and also has registered representatives dedicated to assisting clients in meeting their retirement goals.
Customer Financing
Customer margin accounts are carried whereby money is lent to customers for a portion of the market value of marginable securities held in the customer’s account. Margin loans are collateralized by these securities. Customers also may sell securities short in a margin account, subject to minimum equity and applicable margin requirements, and the availability of such securities to be borrowed. In permitting customers to engage in margin financing, short sale or any other transaction, MSCO assumes the risk of its customers’ failure to meet their obligations in the event of adverse changes in the market affect the value of the margined securities positions. MSCO and NFS reserve the right to set margin requirements higher than those established by the Federal Reserve System.
MSCO has established policies with respect to maximum purchase commitments for new customers or customers with inadequate collateral to support a requested purchase. When transactions occur outside normal guidelines, MSCO monitors accounts closely until their payment obligations are completed. If the customer does not meet the required commitments, MSCO takes steps to close out the position and minimize any loss. In the last five years, MSCO has not had any significant losses as a result of customers failing to meet commitments.
Information and Communications Systems
MSCO relies heavily on its data technology platform and the platform provided by its clearing agents. These platforms offer interfaces to MSCO’s clearing service providers’ computing systems where all customer account records are kept and are accessible through MSCO’s data technology platform. MSCO’s systems also utilize browser-based access and other types of data communications. MSCO’s representatives use NFS systems, by way of MSCO’s data technology platform, to perform daily operational functions which include trade entry, trade reporting, clearing-related activities, risk management and account maintenance.
MSCO’s data technology platform offers services used in direct relation to customer activities as well as support for corporate use. Some of these services include email and messaging, market data systems and third-party trading systems, business productivity tools and customer relationship management systems. MSCO’s data network is designed with redundancies in case a significant business disruption occurs.
To ensure reliability and to conform to regulatory requirements related to business continuity, MSCO maintains backup systems and backup data, leverages cloud-based technology, and has a full-time offsite disaster recovery site to ensure business continuity during a potential wide-spread disruption. However, despite the preventive and protective measures in place, in the event of a wide-spread disruption, MSCO’s ability to satisfy the obligations to customers and other securities firms may be significantly hampered or completely disrupted. For more information regarding the company’s business continuity plan, refer to the Business Continuity Statement on the company’s website.
The company os consistently enhancing technology for both the company’s customers, as well as the company’s internal operations. The company is in the process of enhancing the company’s retail trading platform to provide a seamless user experience for the company’s customers and streamline the company’s operations.
Siebert AdvisorNXT, Inc.
SNXT offers customers the company’s proprietary robo-advisory technology that utilizes trading algorithms initially developed by STCH to create the company’s robo-advisor. This technology provides clients with cost-efficient, competitively priced, and automated wealth management solutions intended to maximize portfolio returns based on specific risk tolerance. The platform utilizes Nobel Prize-winning Modern Portfolio Theory (‘MPT’) to create optimal portfolios for each client. The company provides web-based tools to enable clients to monitor and interact with the robo-advisor’s automated portfolio manager application. The robo-advisor selects low-cost, well-managed, exchange-traded funds (‘ETFs’) and exchange-traded notes (‘ETNs’) that represent the asset classes that provide clients the necessary risk-adjusted exposure given current market conditions. The robo-advisor continuously monitors and periodically rebalances portfolios to address changes in market and economic conditions.
Products and Services: Managed portfolios and separately managed accounts.
Park Wilshire Companies, Inc.
PW is a full-service insurance agency founded in 2010. Through PW the company’s product offerings include various insurance products, such as fixed annuities and property and casualty insurance.
Products and Services: Fixed annuities, personal insurance, property and casualty insurance, natural disaster insurance, and life and disability.
Siebert Technologies, LLC
STCH is a technology company initially tasked with developing a robo-advisor platform. Through STCH, the company expanded its products and services by offering a robo-advisor through SXNT, and the company plans to use this subsidiary for future fintech opportunities and products and services.
RISE Financial Services, LLC
During 2021 and 2022, RISE Prime Services, LLC was a prime broker focused on providing institutional quality services to hedge funds and other institutional investors.
Regulations
MSCO and RISE are registered as broker-dealers with the SEC. MSCO is a member of the NYSE and the FINRA. Much of the regulation of broker-dealers has been delegated to self-regulatory organizations (‘SROs’), principally FINRA, which is MSCO’s and RISE’s primary regulator with respect to financial and operational compliance. These SROs adopt rules (subject to approval by the SEC) governing the industry and conduct periodic examinations of broker-dealers. Securities firms are also subject to regulation by state securities authorities in the states in which they do business. MSCO is registered as a broker-dealer in 50 states, the District of Columbia, and Puerto Rico, and RISE is registered as a broker-dealer in 22 states and territories. These regulations affect the company’s business operations and impose capital, client protection, and market conduct requirements.
As a result of the enactment of the Dodd-Frank Wall Street Reform and Consumer Protection Act in 2010 (‘Dodd-Frank’), the adoption of implementing regulations by the federal regulatory agencies, as well as other recent regulatory reforms, the company has experienced significant changes in the laws and regulations that apply to the company, how the company is regulated, and regulatory expectations in the areas of compliance, risk management, corporate governance, operations, capital and liquidity.
Regulation Best Interest Rules have impacted the conduct of the company’s business, especially with respect to the company’s business with the company’s retail clients.
As a registered broker-dealer and FINRA member organization, MSCO is required by federal law to belong to the SIPC which provides, in the event of the liquidation of a broker-dealer, protection for securities held in customer accounts held by the firm of up to $500,000 per customer, subject to a limitation of $250,000 on claims for cash balances.
MSCO is also authorized by the Municipal Securities Rulemaking Board (‘MSRB’) to affect transactions in municipal securities on behalf of its customers and has obtained certain additional registrations with the SEC and state regulatory agencies necessary to permit it to engage in certain other activities incidental to its brokerage business.
Margin lending arranged by MSCO through third parties is subject to the margin rules of the Board of Governors of the Federal Reserve System and the NYSE.
SNXT is registered with the SEC as an investment adviser pursuant to the Advisers Act.
The company conducts financial services activities that are subject to the Bank Secrecy Act of 1970 (‘BSA’), as amended by the USA PATRIOT Act of 2001 (‘PATRIOT Act’), which require financial institutions to develop and implement programs reasonably designed to achieve compliance with these regulations. In addition, the company is subject to the U.S. sanctions programs administered by the Office of Foreign Assets Control.
To the extent they are applicable to the company, it must comply with federal and state information-related laws and regulations in the United States, including the Gramm-Leach-Bliley Act of 1999, SEC Regulation S-P, the Fair Credit Reporting Act of 1970, as amended, and Regulation S-ID, as well as the California Consumer Protection Act and further potential federal and state requirements.
History
Siebert Financial Corp., a New York corporation, was incorporated in 1934.
