Pacific West Securities Shuts Down, With Many Brokers To Be Absorbed By Cetera Unit

Pacific West Securities, an independent broker dealer with about 290 affiliated representatives and advisors is closing its doors. According to a press release, many of its representatives will be moving to Denver, Colo.-based Multi-Financial Securities Corp, a full-service brokerage unit of Cetera Financial Group. The release says a “recruitment deal” has been struck by the two brokers.

Shrinking margins in the independent broker-dealer space are blamed for the shut down at a time when many of its competitors in the business have also been unable to stay afloat.

“In recent years, we have been faced with a steady increase in costs to operate a high quality broker-dealer,” Karalyn Carlton, Pacific West vice president of marketing said in a statement, pointing to “the increased cost of regulation and supervision, as well as the need for investment in technology and platforms.”

Pacific West CFO Tony Pizelo states in Multi-Financial Services’ press release that “After extensive due diligence, we have chosen Multi-Financial as the best platform for our advisors.” Multi-Financial Securities Corp. and Pacific West are now collaborating on how best to move the brokers, he said.

Pacific West generated $46 million in fees and commission last year and has been on track to see $54 million in gross revenue this year, Investment News reported, adding that Pizelo expects well over 50 percent of Pacific West's brokers to make the move to Multi-Financial Services.

Pacific West is just the latest in a number of broker dealers that have been forced to call it quits since early 2010, Investment News states.

The Pacific-West/Multi-Financial recruitment deal remains subject to FINRA approval, Multi-Financial Services said.