USA Financial Securities Corporation Review

Disciplinary Questions

After checking the disciplinary records of USA Financial Securities Corporation, our system has identified the following question(s) to ask. Learn more.

USA Financial Securities Corporation or an advisory affiliate was previously involved with violating a regulation or statute by a domestic or foreign court, the SEC, CFTC, or another regulatory body or commodities exchange.

What happened? When? How many times did it occur? Will anyone that was involved be involved with my accounts in any capacity?

The SEC, CFTC, or another regulatory agency has previously entered an order against USA Financial Securities Corporation or an advisory affiliate in connection with an investment-related activity.

What happened? When? How many times did it occur? Will anyone that was involved be involved with my accounts in any capacity?

Our system found no other disciplinary questions to ask. Checks take place monthly.

Conflict Questions

After checking the regulatory records of USA Financial Securities Corporation, our system has identified the following question(s) to ask. Learn more.

What percentage of income does USA Financial Securities Corporation receive from fees versus commissions?

USA Financial Securities Corporation can accept commissions for its investment advisory services. These commissions may be earned from the sale of investment or insurance products and are paid by the companies providing the products being sold. While this allows for a broader range of investment options and management styles a firm can offer, it can also create an incentive for the firm to put their financial interests ahead of your own. Is the firm’s purpose to provide you financial planning and ongoing advice or to sell commission-based products to its clients?

Is USA Financial Securities Corporation also a Broker-Dealer or are they affiliated with one? What conflicts arise from this relationship? How does USA Financial Securities Corporation mitigate them?

Currently USA Financial Securities Corporation is also a Broker-Dealer or is affiliated with one. When firms are dual-registered as broker-dealers, they may be subject to compensation-related conflicts of interest, including revenue sharing from mutual funds, cross-selling of commissioned insurance products, and the sale of proprietary investment products. All of these conflicts can negatively impact clients via hidden fees and overall higher costs.

Does USA Financial Securities Corporation offer mutual funds that have 12b-1 fees?

12b-1 fees increase the total annual cost of owning a mutual fund with no guarantee of higher returns. Some firms receive these fees as payments, which creates an incentive to promote them.

Does USA Financial Securities Corporation offer products that have performance-based fees, or does it accept performance-based fees? Will any of my assets be invested in those products?

When performance-based fees are charged, the financial advisor is paid for outperforming a benchmark, typically an index. While this may seem like an attractive compensation structure to ensure your advisor is making your money work for you, often, the managers of those products are incentivized to take inappropriate risks to beat their performance benchmark. For instance, research has shown that mutual funds that use incentive fees take on more risk that funds that do not, and tend to double down and increase their risk following a poor performance. This could be detrimental to a client during down markets.

Does USA Financial Securities Corporation perform side-by-side management? How does USA Financial Securities Corporation mitigate conflicts that arise from managing accounts with differing fee structures?

This typically occurs when firms manage mutual funds or hedge funds alongside smaller retail accounts. Side-by-side management can create an incentive for the advisor to favor the larger funds, potentially leading to unequal trading costs and unfavorable trade executions for their retail clients.

Which securities does USA Financial Securities Corporation trade for itself that it will also be recommending to me?

USA Financial Securities Corporation has marked in their disclosures that they trade recommended securities. While this often can be seen as "eating your own cooking," there are several inherent conflicts that can arise. For example, front running is when a financial professional buys or sell securities ahead of their client. In short, any financial professional should disclose all positions they hold (or have sold short) that they will also be recommending to you.

Our system found no other conflict questions to ask. Checks take place monthly.