What Is a “Custodian?”

Change of Custodian

A custodian is a financial institution with regulatory responsibilities for an investor’s securities, a “house” where your investments live. Blue Spark Capital Advisors is changing custodians to Fidelity from TD, a move that we believe is better for our clients in several ways. You should have received the paperwork, call us with any questions.

Investments that you entrust to our firm are now placed in custody with Fidelity’s clearing firm, National Financial Services. A clearing firm is an organization that handles the execution, clearance, and settlement of transactions. Fidelity has 70 years of financial management experience and a reputation for integrity and service.

Fidelity also aligns with our philosophy and belief in privately owned firms. Privately owned firms are able to make decisions based on long-term benefits for its clients –rather the short-term needs of stockholders of a publicly traded company. For example, Fidelity reinvests a large portion of its profits in technology and customer services.

Safeguarding Assets

Fidelity protects customer assets held in custody through its relationship with National Financial Services (NFS). NFS is subject to the
rules and regulations of the Securities and Exchange Commission (SEC) and other regulatory organizations. These organizations have established a number of financial responsibility rules and regulations that NFS follows to help safeguard your assets, including keeping accurate records of your assets and maintaining net capital at required levels. In compliance with SEC rules, NFS has its financial information audited every year by an independent public accounting firm. Further, as a member of the New York Stock Exchange (NYSE) and the Financial Industry Regulatory Authority (FINRA) and registered with the SEC, NFS is subject to their regulatory oversight and examinations.

Excess Coverage

Fidelity has arranged for insurance protection
beyond the coverage through the Securities Investor Protection Corporation (SIPC). While your assets
are covered by the SIPC up to $500,000, including cash claims limited to $250,000, Fidelity provides supplemental protection that covers your account over and above this SIPC coverage. NFS provides for brokerage accounts additional coverage from Lloyd’s of London together with other insurers.

The excess of SIPC coverage would be used when SIPC coverage is exhausted. Like SIPC protection, “excess of SIPC protection” does not cover investment losses in customer accounts due to market fluctuations or other claims for losses incurred while broker-dealers remain in business. Total aggregate excess of SIPC coverage available through NFS’s “excess of SIPC” policy is $1 billion. Within NFS’s excess of SIPC coverage, there is no per-customer dollar limit on coverage of securities, but there is a per-customer limit of $1.9 million on coverage of cash. This is the maximum excess of SIPC protection currently available in the brokerage industry.

Blue Spark Capital Advisors

We're a boutique fee-only Registered Investment Advisory (RIA) and financial planning firm based in New York City and the Berkshires.

We provide planning and investment management services and financial coaching to women, men and their families.

We believe in a holistic approach. Movement in each piece of your financial plan impacts the others, so we consider your entire picture.

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Contact Us

41 Madison Avenue (40th Floor)
New York, N.Y. 10010
(212) 537-3899

93 Church Street
Lenox, Mass. 01240
(413) 551-4445

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"Integrity without knowledge is weak and useless, and knowledge without integrity is dangerous and dreadful."
– Samuel Johnson (1709-1784)
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