Patent Publication Number: US-2010125481-A1

Title: System and method for providing investment products

Description:
BACKGROUND OF THE INVENTION  
     Customers often prefer to have one provider for both their insurance and investment needs. Property and casualty insurance agencies often lack the expertise and other prerequisites, such as necessary licensing, to provide their customers with investment products such as retirement plans, life insurance, annuities, or mutual funds. As such, many customers who need property and casualty insurance coverage, such as small or mid-sized business owners, often do not take advantage of investment products for their businesses. Consolidating the provision of insurance and investment products into one entity would not only reduce complexity for a customer, but also allow the customer to rely and capitalize on the pre-existing relationship and trust already built between the entity and customer 
     SUMMARY OF THE INVENTION  
     A need exists in the art for systems and methods that would allow such insurance providers, and more generally any provider of business services, to partially own interests in a structured wholesale broker dealer that in turn provides for effective expansion of the investment product services they may offer to their customers and the access by their customers to financial products. 
     Accordingly, in one aspect, the invention relates to a data processing system for enabling partial owners of a wholesale broker dealer (“partial owners”) to participate in providing investment products. The data processing system includes a computer memory and a computer processor operated by the wholesale broker-dealer. The memory stores data, e.g., in the form of electronic data files, indicative of wholesale fees and data indicative of expenses. The wholesale fees are received by the wholesale broker-dealer for providing the wholesale support services to registered representatives of a separate retail broker-dealer who are affiliated with the partial owners. The wholesale fees are received in relation to sales of the investment products by the retail broker dealer. The expenses are incurred by the wholesale broker-dealer in relation to providing the wholesale support services. The computer processor is configured to, on a recurring basis, allocate the wholesale fees and the expenses among the partial owners, determine a distribution for each of a plurality of the partial owners based on a difference between the wholesale fees and the expenses allocated to the respective partial owners, and effect the distributions. The distribution for each partial owner may be either a profit for receipt by the respective partial owner or a loss to be paid by the respective partial owner to the wholesale broker-dealer. A distribution may be effected by disbursing a payment for receipt by a partial owner. 
     In some embodiments, at least a plurality of the partial owners are non-broker dealers. In some embodiments, an underwriting broker-dealer or an affiliate thereof owns an interest in the wholesale broker-dealer. 
     In some embodiments, the wholesale fees and/or the expenses allocated to each partial owner depend in part on the wholesale support services received by registered representatives affiliated with the respective partial owners. 
     In some embodiments, the processor is further configured to, on a recurring basis, generate and output reports that include at least one of the determined distributions to the partial owners. 
     According to another aspect, the invention relates to a computerized method for enabling partial owners of a wholesale broker-dealer to participate in providing investment products. The computerized method includes storing, by a wholesale broker dealer computer system in computer memory, data indicative of wholesale fees and storing data indicative of expenses. The wholesale fees are received by a wholesale broker-dealer for providing the wholesale support services to registered representatives of a separate retail broker-dealer who are affiliated with the partial owners. The fees are related to sales of investment products made by the retail broker dealer. The expenses are incurred by the wholesale broker-dealer in relation to providing the wholesale support services. The computerized method further includes allocating, by the wholesale broker-dealer computer system on a recurring basis, the wholesale fees and the expenses among at least a plurality of the partial owners, determining a distribution for a plurality of the partial owners based on a difference between the wholesale fees and the expenses allocated to the respective partial owners, and effecting the distributions. 
     According to another aspect, the invention relates to a system for enabling partial owners of a wholesale broker dealer to participate in providing investment products. The system includes computer processors operated by an underwriting broker-dealer, a wholesale broker-dealer, a retail broker-dealer, and the partial owners. The computer processor operated by the underwriting broker-dealer is configured for disbursing payments of wholesale fees to the wholesale broker-dealer and disbursing payments of commissions to the retail broker-dealer. The wholesale fees are for providing wholesale support services to registered representatives of the retail broker-dealer who are affiliated with at least a plurality of the partial owners and are received based on sales of investment products by the retail broker-dealer. The computer processor operated by the wholesale broker-dealer is configured for performing on a recurring basis the steps of: allocating among at least a plurality of the partial owners the wholesale fees received by the wholesale broker-dealer and expenses incurred by the wholesale broker-dealer in relation to providing the wholesale support services, determining distributions for at least a plurality of the partial owners based on a difference between the wholesale fees and the expenses allocated to the respective partial owners, and effecting the distributions. The computer processor operated by the retail broker-dealer is configured for distributing the commissions received by the retail broker-dealer among the registered representatives. Each computer processor operated by one of the partial owners is configured for: receiving data indicative of the distribution for the respective partial owner and disbursing a payment to the wholesale broker-dealer if the distribution for the respective partial owner is a loss to be paid by the respective partial owner to the wholesale broker-dealer. 
     According to another aspect, the invention relates to a system for enabling partial owners of a wholesale broker dealer to participate in providing investment products. The system includes first and second storing modules, an allocation module, a distribution module, and an effecting module. The first storing module stores in computer memory data indicative of wholesale fees received by a wholesale broker-dealer for providing wholesale support services to registered representatives of a separate retail broker-dealer who are affiliated with at least a plurality of the partial owners. The wholesale fees are received based on sales of investment products by the retail broker-dealer. The second storing module stores in computer memory data indicative of expenses incurred by the wholesale broker-dealer in relation to providing the wholesale support services. The allocation module allocates, on a recurring basis, the wholesale fees and the expenses stored in the computer memory among at least a plurality of the partial owners. The distribution module determines, on a recurring basis, a distribution for each of at least a plurality of the partial owners based on a difference between the wholesale fees and the expenses allocated to the respective partial owner. The effecting module effects, on a recurring basis, the distributions. In some embodiments, the system includes a reports module for generating reports comprising at least one of the determined distributions for receipt by computer systems operated by the partial owners. 
    
    
     
       BRIEF DESCRIPTION OF THE DRAWINGS 
       The invention may be better understood from the following illustrative description with reference to the following drawings. 
         FIG. 1  is a block diagram depicting entities which may use the systems described herein and their relationships relative to one another, according to an illustrative embodiment of the invention. 
         FIG. 2  is a block diagram of a system for enabling partial owners of a wholesale broker-dealer to participate in providing investment products, according to an illustrative embodiment of the invention. 
         FIG. 3  is a block diagram of computer architecture suitable for implementing various computing devices depicted in the system of  FIG. 2 . 
         FIG. 4  is a functional block diagram of a system for enabling partial owners of a wholesale broker-dealer to participate in providing investment products, according to an illustrative embodiment of the invention. 
         FIG. 5  is an exemplary report that may be generated by the system depicted in  FIG. 4 . 
         FIG. 6  depicts a system of modules for enabling partial owners of a wholesale broker-dealer to participate in providing investment products, according to an illustrative embodiment of the invention. 
         FIG. 7  is a flow chart of a method for enabling partial owners of a wholesale broker-dealer to participate in providing investment products, according to an illustrative embodiment of the invention. 
     
    
    
     DESCRIPTION OF CERTAIN ILLUSTRATIVE EMBODIMENTS 
     To provide an overall understanding of the invention, certain illustrative embodiments will now be described. However, it will be understood by one of ordinary skill in the art that the methods and systems described herein may be adapted and modified as is appropriate for the application being addressed and that the systems and methods described herein may be employed in other suitable applications, and that such other additions and modifications will not depart from the scope thereof. 
       FIG. 1  is a block diagram depicting entities  100  which may use systems and methods for enabling partial owners of a wholesale broker-dealer to participate in providing investment products, as described herein, according to an illustrative embodiment of the invention. In particular,  FIG. 1  depicts the relationships between the entities depicted therein. The term “investment product”, as used herein, shall refer to a security, collective trust, investment insurance product, or other similar product sold by a registered representative of a broker-dealer. The customer may be an individual or a business seeking fixed or variable annuities, mutual funds, life insurance, disability insurance, and/or other products for purposes of retirement planning, estate planning, and/or protection against financial uncertainties associated with death or disability. In particular, the methods and systems described herein are particularly well suited for, but are not limited to, handling the investment product needs of small businesses. Systems and methods for effecting the relationships depicted in  FIG. 1  are described below with respect to  FIGS. 2-6 . In particular, systems and methods for exchanging data and disbursements between the entities  100  are further described below. 
     An underwriting broker-dealer  102  underwrites for an issuing company, the securities that are available for sale to the public for a fee. The investment products administered by underwriting broker-dealer  102  are sold by representatives  104   a,    104   b,    104   c,  and  104   d  of a retail broker-dealer  108  who are licensed or registered to sell securities for example, with the Financial Industry Regulatory Authority (“FINRA”) and/or with the appropriate state agency or board. Each representative  104  is affiliated with a partial owner  106   a  or  106   b  of a wholesale broker-dealer  110 . The affiliations are depicted in  FIG. 1  with dashed affiliation lines  107 . For example, each representative  104  may be an employee of one of the partial owners  106 . In some embodiments, at least some of the partial owners  106  are non-broker-dealers, such as property and casualty insurance agencies that provide insurance policies for businesses and/or individuals, such as worker&#39;s compensation, property, automobile, liability, and home-owner policies, and representatives  104  are both registered representatives of a broker deal and also insurance agents affiliated with or employed by the agencies. Partial owners may also be other providers of business services who do not have a broker-dealer license, but whose customers may be interested in investment products. Exemplary partial owners  106  include payroll organizations, preferred provider organizations (“PPOs”), certified public accountants (“CPAs”), benefits providers, law firms, and consulting firms. Individuals may also be partial owners  106 . The number of partial owners who use the systems and methods described herein and the number of representatives per partial owner may vary without departing from the scope of the invention. 
     Representatives  104  receive support services from retail and wholesale broker-dealers  108  and  110 . Retail broker-dealer  108  provides retail support services such as overseeing representatives or assisting representatives to become licensed or registered. In addition, the retail broker-dealer  108  serves as broker-dealer for the representatives  104 , such as by buying and selling securities on behalf of the underwriting broker-dealer  102  or issuer to the representatives&#39; customers. Wholesale broker-dealer  110  provides wholesale support services  120  to retail broker-dealer  108 . Exemplary wholesale support services  120  include education and training with respect to the investment products underwritten by the underwriting broker-dealer, including how to market investment products; assistance in business development, including providing marketing materials and sales leads; and coordination of the establishment and administrative needs of an investment product (e.g., retirement plan or mutual fund) for a customer. The retail broker-dealer  108  may have representatives, other than representatives  104 , who are not affiliated with partial owners  106  and do not receive wholesale support services from wholesale broker-dealer  110 . Partial owners  106 , with which representatives  104  are affiliated, each own an interest in wholesale broker-dealer  110 . Optionally, underwriting broker-dealer  102 , or an affiliate, also owns an interest in wholesale broker-dealer  110 . Wholesale broker-dealer  110  has employees such as regional sales directors (“RSDs”) each of whom provide support services to representatives  104  of a particular geographic region. In some embodiments, a single broker-dealer performs the services of wholesale and retail broker-dealers  108  and  110 . In some embodiments, wholesale broker-dealer  110  provides wholesale support services to multiple retail broker-dealers. 
     Underwriting broker-dealer  102  disburses payments arising from sales of investment products transacted by representatives  104 . In particular, underwriting broker-dealer  102  pays commissions  112  and wholesale fees  114  to retail broker-dealer  108  and wholesale broker-dealer  110 , respectively. Commissions  112  are determined based on the value and/or volume of sales of investment products transacted by representatives  104 . Retail broker-dealer  108 , in turn, disburses commission payments  116  to individual representatives  104  based on their individual sales. Wholesale fees  114  are determined based on services  120  rendered by wholesale broker-dealer  110 . For example, each type of investment product may correspond to a specific wholesale fee rate which is used to determine wholesale fees for services  120  rendered regarding that type of investment product. In some embodiments, wholesale broker-dealer  110  provides wholesale support services for investment products issued, carried, or underwritten by multiple underwriting broker-dealers, in which case wholesale broker-dealer  110  receives wholesale fees from the multiple underwriting broker-dealers. 
     Wholesale broker-dealer  110 , in turn, determines and disburses distributions  118 , which represent either a profit or a loss, to partial owners  106 . Wholesale broker-dealer  110  determines distributions  118  by first allocating revenues received, such as wholesale fees  114 , and expenses incurred among its owners, which include partial owners  106 . Revenue and expenses are allocated to the partial owners  106  by allocating revenue and expenses to distinct divisions within the wholesale broker-dealer  110  associated with respective partial owners  106 . Wholesale broker-dealer  110  then calculates a partial owner&#39;s distribution based on the difference between its allocated revenues and allocated expenses. Allocations of revenues and expenses to a partial owner may correspond to a membership interest that the respective partial owner has in the wholesale broker-dealer  110 , which may be governed, for example, by an agreement establishing the wholesale broker-dealer  110  (e.g., a limited liability company agreement). In some embodiments, the distributions  118  are determined at the end of each fiscal year, based on allocations of revenues and expenses for that fiscal year. A partial owner&#39;s distribution is a profit, namely the partial owner receives a payment, if the allocated revenues for that partial owner exceed its allocated expenses. A partial owner&#39;s distribution is a loss, namely the partial owner must pay into a capital account of the wholesale broker-dealer  110 , if the allocated expenses for that partial owner exceed its allocated revenues. Distribution determinations are described further in relation to  FIG. 4 . 
       FIG. 2  is a block diagram of a system  200  for enabling partial owners of a wholesale broker dealer to participate in providing investment products, according to an illustrative embodiment of the invention. System  200  includes an underwriting broker-dealer system  202  in communication with registered representative system  204  and wholesale and retail broker-dealer systems  206  and  208 , each of which is operated by a corresponding entity as described above with respect to  FIG. 1 . In particular, underwriting broker-dealer system  202  is operated by an entity similar to underwriting broker-dealer  102  of  FIG. 1 . Registered representative system  204  is operated by a user similar to representative  104  of  FIG. 1  affiliated with a partial owner  106  of  FIG. 1 . In some embodiments, system  200  includes multiple registered representative systems  204  each operated by a different registered representative. Wholesale and retail broker-dealer systems  206  and  208  are operated by broker-dealers similar to wholesale and retail broker-dealers  110  and  108 , respectively, of  FIG. 1 . In some embodiments, a single broker-dealer system performs the functions of the wholesale and retail broker-dealer systems described herein. 
     The underwriting broker-dealer system  202  communicates with the systems  204 ,  206 , and  208  over one or a combination of communication networks  212 . The communication networks  212  may be wired, wireless, or a combination thereof. They may be publicly accessible, such as the Internet, or part of a private communications network. Preferably, at least portions of communications over the communication networks  212  are encrypted to protect the privacy of customers. 
     The systems  204 ,  206 , and  208  may include any computing device known in the art capable of networked communication and having a microprocessor capable of executing the user interfaces and processes described herein. In particular, the broker-dealer systems  206  and  208  include software for providing a user interface to users of their respective services and/or generating reports for receipt by partial owner systems. The software may include a thin or thick client, or it may take the form of browser executable code for providing a user interface via a standard Internet browser software application. 
     The underwriting broker-dealer system  202  includes a plurality of application servers  214 , a plurality of load balancing proxy servers  216 , a data warehouse  218 , a business logic processor  220 , and one or more terminals  222 . These computing devices are connected by a local area network  224 . 
     The application servers  214  are responsible for interacting with the systems  204 ,  206 , and  208 . For example, the application servers  214  include software for generating web pages for communication to the systems  204 ,  206 , and  208 . These web pages serve as user interfaces for the registered representative, wholesale broker-dealer, and retail broker-dealer, respectively, to interact with the underwriting broker-dealer system  202 . The load balancing proxy servers  216  operate to distribute the load among application servers  214 . 
     The data warehouse  218  is the main electronic depository of the underwriting broker-dealer&#39;s current and historical data. The data warehouse  218  includes one or more interrelated databases that store information relevant to the provision of investment products, such as information related to the types and values of securities sold by various representatives and/or broker-dealers. The interrelated databases store both structured and unstructured data. Databases in the interrelated databases store data, for example, in a relational database, in various data fields keyed to various identifiers, such as, without limitation, customer, representative, broker-dealer, or type of investment product. The information stored in the data warehouse  218  is obtained through communications with representatives, broker-dealers, and third party data sources. 
     The business logic processor  220  includes one or more computing devices tasked with carrying out determinations of prices, distributions, commissions, wholesale fees, and any other payments relating to the provision of investment products. In particular, the business logic processor  220  is configured to generate reports for receipt by broker-dealers, such as reports of commissions for registered representatives and wholesale fees for the wholesale broker-dealer, and/or to initiate transfers or disbursements of money according to the values determined. 
     The terminals  222  provide various user interfaces to underwriting broker-dealer employees to interact with the business logic processor  220 . The interfaces include, without limitation, interfaces to add new investment products to the underwriting broker-dealer system  202  and to adjust the processes utilized by the business logic processor  220  to generate reports or calculate any other values. Such interfaces may be integrated into one or more websites for managing the underwriting broker-dealer system  202  presented by the application servers  214 , or they may be integrated into thin or thick software clients. The terminals  222  can be any computing devices suitable for carrying out the processes described above, including personal computers, lap top computers, personal digital computers, and other computing devices with general purpose processors. 
     In some embodiments, the wholesale broker-dealer system and/or the retail broker-dealer system is similar to the underwriting broker-dealer system  202 . In particular, a broker-dealer system may have some or all of the devices described above as being part of the underwriting broker-dealer system  202 . A retail broker-dealer may have application servers for providing web interfaces to registered representatives, a business logic processor for determining commissions for registered representatives, and a terminal for providing user interfaces to retail broker-dealer employees to allow, for example, employees to enter applications for investment products. A wholesale broker-dealer may have application servers for providing web interfaces to employees of the retail broker-dealer, a business logic processor for determining profit distributions for the partial owners, and a terminal for providing user interfaces to wholesale broker-dealer employees. 
       FIG. 3  is a block diagram of a computer architecture  300  suitable for implementing various computing devices  301  incorporated into the system  200 , including, for example, the application servers  214  and the business logic processor  220 . 
     Computing device  301  comprises at least one central processing unit (CPU)  302 , at least one read-only memory (ROM)  303 , at least one communication port or hub  304 , at least one random access memory (RAM)  305 , and one or more databases or data storage devices  306 . All of these later elements are in communication with the CPU  302  to facilitate the operation of the computing device  301 . The computing device  301  may be configured in many different ways. For example, computing device  301  may be a conventional standalone server computer or alternatively, the function of server may be distributed across multiple computing systems and architectures. 
     Computing device  301  may be configured in a distributed architecture, wherein databases and processors are housed in separate units or locations. Some such servers perform primary processing functions and contain at a minimum, a general controller or a processor  302 , a ROM  303 , and a RAM  305 . In such an embodiment, each of these servers is attached to a communications hub or port  304  that serves as a primary communication link with other servers  307 , client or user computers  308  and other related devices  309 . The communications hub or port  304  may have minimal processing capability itself, serving primarily as a communications router. A variety of communications protocols may be part of the system, including but not limited to: Ethernet, SAP, SAS™, ATP, BLUETOOTH™, GSM and TCP/IP. 
     The CPU  302  comprises a processor, such as one or more conventional microprocessors and one or more supplementary co-processors such as math co-processors. The CPU  302  is in communication with the communication port  304  through which the CPU  302  communicates with other devices such as other servers  307 , user terminals  308 , or devices  309 . The communication port  304  may include multiple communication channels for simultaneous communication with, for example, other processors, servers or client terminals. Devices in communication with each other need not be continually transmitting to each other. On the contrary, such devices need only transmit to each other as necessary, may actually refrain from exchanging data most of the time, and may require several steps to be performed to establish a communication link between the devices. 
     The CPU  302  is also in communication with the data storage device  306 . The data storage device  306  may comprise an appropriate combination of magnetic, optical and/or semiconductor memory, and may include, for example, RAM, ROM, flash drive, an optical disc such as a compact disc and/or a hard disk or drive. The CPU  302  and the data storage device  306  each may be, for example, located entirely within a single computer or other computing device; or connected to each other by a communication medium, such as a USB port, serial port cable, a coaxial cable, a Ethernet type cable, a telephone line, a radio frequency transceiver or other similar wireless or wired medium or combination of the foregoing. For example, the CPU  302  may be connected to the data storage device  306  via the communication port  304 . 
     The data storage device  306  may store, for example, (i) a program (e.g., computer program code and/or a computer program product) adapted to direct the CPU  302  in accordance with the present invention, and particularly in accordance with the processes described in detail hereinafter with regard to the CPU  302 ; (ii) databases adapted to store information that may be utilized to store information required by the program. Suitable databases include data warehouse  218  of  FIG. 2 . 
     The program may be stored, for example, in a compressed, an uncompiled and/or an encrypted format, and may include computer program code. The instructions of the program may be read into a main memory of the processor from a computer-readable medium other than the data storage device  306 , such as from a ROM  303  or from a RAM  305 . While execution of sequences of instructions in the program causes the processor  302  to perform the process steps described herein, hard-wired circuitry may be used in place of, or in combination with, software instructions for implementation of the processes of the present invention. Thus, embodiments of the present invention are not limited to any specific combination of hardware and software. 
     Suitable computer program code may be provided for performing numerous functions such as recording sales of investment products, generating reports based on sales of investment products, and calculating distributions, commissions, wholesale fees, or expenses related to investment products. The program also may include program elements such as an operating system, a database management system and “device drivers” that allow the processor to interface with computer peripheral devices (e.g., a video display, a keyboard, a computer mouse, etc.). 
     The term “computer-readable medium” as used herein refers to any medium that provides or participates in providing instructions to the processor of the computing device (or any other processor of a device described herein) for execution. Such a medium may take many forms, including but not limited to, non-volatile media and volatile media. Non-volatile media include, for example, optical, magnetic, or opto-magnetic disks, such as memory. Volatile media include dynamic random access memory (DRAM), which typically constitutes the main memory. Common forms of computer-readable media include, for example, a floppy disk, a flexible disk, hard disk, magnetic tape, any other magnetic medium, a CD-ROM, DVD, any other optical medium, punch cards, paper tape, any other physical medium with patterns of holes, a RAM, a PROM, an EPROM or EEPROM (electronically erasable programmable read-only memory), a FLASH-EEPROM, any other memory chip or cartridge, or any other medium from which a computer can read. 
     Various forms of computer readable media may be involved in carrying one or more sequences of one or more instructions to the processor  302  (or any other processor of a device described herein) for execution. For example, the instructions may initially be borne on a magnetic disk of a remote computer  308 . The remote computer  308  can load the instructions into its dynamic memory and send the instructions over an Ethernet connection, cable line, or even telephone line using a modem. A communications device  304  local to a computing device (or, e.g., a server) can receive the data on the respective communications line and place the data on a system bus for the processor. The system bus carries the data to main memory, from which the processor retrieves and executes the instructions. The instructions received by main memory may optionally be stored in memory either before or after execution by the processor. In addition, instructions may be received via a communication port as electrical, electromagnetic or optical signals, which are exemplary forms of wireless communications or data streams that carry various types of information. 
     As previously discussed with reference to  FIG. 2 , servers may also interact and/or control one or more user devices  309 , such as displays and printers, or remote computers  308  such as, registered representative system  204 , wholesale broker-dealer system  206 , and terminals  222 . These systems and terminals may include any one or a combination of a personal computer, a laptop, a personal digital assistant, a mouse, a keyboard, a computer display, a touch screen, LCD, voice recognition software, or other input/output devices required to implement the above functionality. 
       FIG. 4  is a functional block diagram of a system  400  for enabling partial owners of a wholesale broker-dealer to participate in providing investment products, according to an illustrative embodiment of the invention. The system  400  includes an underwriting broker-dealer system  402 , retail and wholesale broker-dealer systems  408  and  410 , and a plurality of partial owner systems  406 , which are similar to those described above with respect to  FIG. 2  and may communicate over a communications network similar to network  212  of  FIG. 2 . 
     The underwriting broker-dealer system  402  is operated by an entity similar to underwriting broker-dealer  102  of  FIG. 1 . Each partial owner system  406  is operated by a partial owner similar to partial owner  106  of  FIG. 1 , such as a property and casualty insurance agency. Partial owner system  406  includes a plurality of registered representative terminals  412  for use by affiliated registered representatives, similar to representatives  104  of  FIG. 1 , each of whom is affiliated with a partial owner. Retail and wholesale broker-dealer systems  408  and  410  are operated by broker-dealers providing, respectively, retail and wholesale support services for investment products to registered representatives (similar to retail and wholesale broker-dealers  108  and  110  of  FIG. 1 ). In some embodiments, a single broker-dealer system performs the functions of the wholesale and retail broker-dealer systems described herein. 
     Retail broker-dealer system  408  may provide a form or user interface to the registered representative terminals  412  (e.g., a web interface provided by an application server of retail broker-dealer system  408  and displayed on a registered representative terminal of registered representative system  406 ) for allowing an affiliated registered representative to establish or record a sale to a customer of an investment product offered by the underwriting broker-dealer. Information collected by the form or user interface can be stored in a database of retail broker-dealer system  408  and/or transmitted to underwriting broker-dealer system  402  to be stored. 
     Underwriting broker-dealer system  402  maintains investment products, such as mutual funds or retirement plans, by executing investments on behalf of and collecting payments into a customer&#39;s investment product. Underwriting broker-dealer system  402  may also disburse payments to registered representatives and/or broker-dealers arising from an investment product, such as commissions or fees, via, for example, an accounting system shared by the systems of  FIG. 4 . Generally, underwriting broker-dealer system  402  performs standard operations usually performed by a financial services system for purposes of managing and issuing investments. In some embodiments, underwriting broker-dealer system  402  provides forms or user interfaces (e.g., a web interface) to be displayed by retail broker-dealer system  408  to allow an employee of the retail broker-dealer to manually enter applications for investment products, where applications are received from a registered representative. In some embodiments, underwriting broker-dealer system  402  provides forms or user interfaces (e.g., a web interface) to be displayed by partial owner system  406 , for example by registered representative terminal  412 , to registered representatives to manually enter applications for investment products. Underwriting broker-dealer system  402  can generate customized forms or user interfaces for use by retail broker-dealer system  408  or partial owner system  406 . 
     Sales information collected by retail broker-dealer system  408  may be transmitted as a report (e.g., as a spreadsheet, data file, or other data indicative of the information) of sales transacted over a predetermined period of time (e.g., month, fiscal quarter, or year), over a manually entered time range, since a last report was output, or in real-time. The timing of transmissions of sales information may be different than the timing of payments or disbursements arising from the sales. For example, transacted sales may be reported each month while commissions are disbursed each fiscal quarter. Exemplary sales information includes parameters of the investment product, customer identification, registered representative who transacted the sale, and the partial owner with which the registered representative is affiliated. The report may be organized by registered representative and/or partial owner. 
     Underwriting broker-dealer system  402  includes a processor configured to calculate sales commissions to be paid by the underwriting broker-dealer for receipt by each registered representative based on sales transacted by the respective registered representative. The underwriting broker-dealer system  402  disburses the calculated commissions to each registered representative or to the retail broker-dealer system  408 , which then would in turn disburse the appropriate commission to each registered representative. A report including the commissions calculated for each registered representative can form a report to be transmitted to the retail broker-dealer system  408 . Alternatively, retail broker-dealer system  408  includes a processor configured to calculate the commissions and to transmit a bill for the commissions to the underwriting broker-dealer system  402 . 
     Underwriting broker-dealer system  402  includes a processor configured to calculate wholesale fees to be paid by the underwriting broker-dealer to the wholesale broker-dealer, for wholesaling services provided by the wholesale broker-dealer to the registered representatives and partial owners. Rates for wholesale fees are stored in a database of the underwriting broker-dealer system  402  for use by the processor. Such rates may depend on the specific investment product for which wholesale support services are provided. The processor may generate a report, such as a spreadsheet, of the calculated wholesale fees to be transmitted for receipt by wholesale broker-dealer system  410 . Reports may be configured to be displayed to an employee of the wholesale broker-dealer on, for example, a user terminal of wholesale broker-dealer system  410  and/or to be stored in a database of wholesale broker-dealer system  410 . Such reports may be transmitted automatically, such as via a script, or in response to a request, such as a web service request, received from the wholesale broker-dealer system  410 . Automatically-generated reports may be generated on a periodic basis, such as each month or each fiscal quarter. Reports may be generated in response to input from an employee of the underwriting broker-dealer using a user terminal of the underwriting broker-dealer system  402 . The processor may be further configured to disburse the calculated wholesale fees for receipt by the wholesale broker-dealer system  410 . Alternatively, wholesale broker-dealer system  410  includes a processor configured to calculate the wholesale fees and/or transmit a bill for the wholesale fees for receipt by the underwriting broker-dealer system  402 . 
     Wholesale broker-dealer system  410  includes a processor configured to calculate a profit or loss to be distributed to each partial owner. Profits and losses are allocated to the partial owners by allocating revenue and expenses to distinct divisions within the wholesale broker-dealer associated with respective partial owners. The distribution received by each partial owner is based on revenues and expenses of the wholesale broker-dealer that are allocated to the respective partial owner. If the allocated expenses are higher than the allocated revenue for a partial owner, then the calculated distribution is a loss and the wholesale broker-dealer system  410  bills, or otherwise collects, the difference from the partial owner. Vice versa, if the allocated revenues are higher than the allocated expenses for a partial owner, then the calculated distribution is a profit and the wholesale broker-dealer system  410  generates a report for transmittal to or disburses the profit to the partial owner system  406 . 
     Revenues primarily comprise wholesales fees received from the underwriting broker-dealer and are allocated to each owner of the wholesale broker-dealer, namely to each partial owner and to the underwriting broker-dealer if the underwriting broker-dealer is also an owner. Revenue allocated to each partial owner is based on sales generated by the registered representatives affiliated with the respective partial owner. Revenue allocation may also be based on the initial capital contribution made by a partial owner at the creation of the wholesale broker-dealer. In some embodiments in which the underwriting broker-dealer at least partially owns the wholesale broker-dealer, between about 5% and about 15% of the wholesaling revenues received will be credited to the underwriting broker-dealer or affiliate owner and the remaining amount will be allocated to the partial owners, based on the wholesaling activities for each partial owner. 
     Expenses include fixed expenses, direct expenses, and variable costs. Exemplary expenses include salaries, incentives, wholesale representative fees, audit fees, and travel and entertainment for wholesale representatives. Expense allocation depends on the type of expense. In particular, fixed expenses, such as audit fees or other expenses common to all partial owners are allocated evenly among the partial owners or proportionately among the partial owners according to their ownership interest. Direct expenses, i.e., expenses that are specific to a particular partial owner, are allocated to that partial owner. For example, travel and entertainment expenses may be directly allocated to the partial owner whose registered representatives the wholesale representative visited. Variable expenses are allocated based on relative sales transacted by the partial owners. For example, variable expenses may be charged to each partial owner based upon the partial owner&#39;s revenue relative to the total revenue for all partial owners for that period. 
     Reports including revenue allocation, expense allocation, and/or distributions for a partial owner may be generated and transmitted by wholesale broker-dealer system  410  for receipt by each partial owner system  406 . Reports may list revenues received by a partial owner and specific expenses incurred by or allocated to a partial owner, organized by partial owner, year, quarter, and/or month. Reports may also list the total value of sales transacted by registered representatives of a partial owner over the relevant period and the percentage it represents out of total sales over all partial owners. A report may include information relating to all partial owners or solely to the specific partial owner that receives the report. A report may include summary information relating to all partial owners and more detailed information relating to a specific partial owner. 
     Reports may be configured to be displayed to an employee of the partial owner on, for example, a user terminal of partial owner system  406  and/or to be stored in a database of partial owner system  406 . Such reports may be transmitted automatically, such as via a script, or in response to a request, such as a web service request, received from a partial owner system  406 . Automatically-generated reports may be generated on a periodic basis, such as each month or each fiscal quarter. Reports may be generated in response to input from an employee of the wholesale broker-dealer using a user terminal of the wholesale broker-dealer system  410 . The processor may be further configured to disburse the calculated distributions for receipt by partial owner systems  406 . 
     An exemplary report that may be displayed to a user is depicted in  FIG. 5 . In the example depicted in  FIG. 5 , a wholesale broker-dealer is owned by  15  partial owners having sales totaling $50,000,000 (50M), which corresponds to $303,816 in net revenues from wholesale fees corresponding to those sales, i.e., total revenues less the revenues allocated to a underwriting broker dealer(or affiliate thereof) owner. The categories of revenues and expenses to be allocated are listed in the left-most column, followed by their corresponding total values in the next column, the type of allocation to be applied to each category in the third column, and finally the allocations to each partial owner in the remaining columns. The categories include wholesale fee revenues (“net revenue”), variable and fixed compensation for employees of the wholesale broker dealer (“RSD variable comp.” and “RSD fixed comp.”), travel and entertainment expenses incurred by the employees (“RSD T&amp;E”), and regulatory and audit fees (“RSD regulatory fees” and “audit fee”). Types of allocations include variable (“V”), direct (“D”), and fixed (“F”). Variable allocations, such as wholesale fee revenues, are allocated to each of the 15 partial owners in proportion to the percentage of sales generated by the respective partial owner. For example, in the illustrative report, $72,916 of revenues, which represents 24% of the total $303,816 revenues, is allocated to partial owner  1  because registered representative(s) affiliated with partial owner  1  had sales totaling $12 million, which is 24% of the $50 million total sales. Direct allocations are allocated directly to the partial owner which incurred the expense (e.g., travel and entertainment expenses for wholesale broker-dealer employees to visit registered representatives affiliated with a specific partial owner are allocated to that specific partial owner). Fixed expense allocations are divided equally among the 15 partial owners. The last row lists the difference between allocated revenues and expenses for each partial owner. In alternative implementations, fixed expenses may be allocated based in part on each partial owner&#39;s capital contribution to the wholesale broker dealer. 
     Generally, calculations executed by any of the processors described above with respect to  FIG. 4  may be implemented by one or more software, hardware, or firmware modules (or a combination thereof) in communication with a user interface, for providing access to and displaying results of the module, and, if necessary, a database in which information necessary to execute the calculations is stored (e.g., wholesale fee rates, values of sales, expenses incurred).  FIG. 6  depicts a system of modules  600  for enabling partial owners of a wholesale broker-dealer to participate in providing investment products, according to an illustrative embodiment of the invention. System  600  includes first and second storing modules  602  and  604 , computer memories  606  and  608 , an allocation module  610 , a distribution module  612 , and an effecting module  614 . In some embodiments, system  600  also includes a reports module  616 . 
     As used herein, a “module” may be implemented in software for execution by various types of processors. An identified module of executable code may, for instance, comprise one or more physical or logical blocks of computer instructions which may, for instance, be organized as an object, procedure, or function. Nevertheless, the executables of an identified module need not be physically located together, but may comprise disparate instructions stored in different locations which, when joined logically together, comprise the module and achieve the stated purpose for the module. Indeed, a module of executable code could be a single instruction, or many instructions, and may even be distributed over several different code segments, among different programs, and across several memory devices. Similarly, operational data may be identified and illustrated herein within modules, and may be embodied in any suitable form and organized within any suitable type of data structure. The operational data may be collected as a single data set, or may be distributed over different locations including over different storage devices. In addition, entire modules, or portions thereof, may also be implemented in programmable hardware devices such as field programmable gate arrays, programmable array logic, programmable logic devices or the like or as hardwired integrated circuits. 
     The first storing module  602  stores in computer memory  606  data indicative of wholesale fees received by a wholesale broker-dealer for providing wholesale support services to registered representatives of a separate retail broker-dealer. The registered representatives are affiliated with at least a plurality of the partial owners. The wholesale fees are received based on sales of investment products by the retail broker-dealer. The second storing module  604  stores in computer memory  608  data indicative of expenses incurred by the wholesale broker-dealer in relation to providing the wholesale support services. Computer memories  606  and  608  may be separate devices or the same device and may be a database or other data storage device, such as any of those described above with respect to  FIG. 3 . 
     The allocation module  610  allocates, on a recurring basis, the wholesale fees and the expenses stored in computer memories  606  and  608  among at least a plurality of the partial owners. In some embodiments, the allocation module  610  allocates wholesale fees and/or expenses to partial owners based on the wholesale support services received by registered representatives affiliated with the respective partial owners. The distribution module  612  determines, on a recurring basis, a distribution for each of at least a plurality of the partial owners based on a difference between the wholesale fees and the expenses allocated to the respective partial owner. The distribution may be a profit for receipt by the respective partial owner or a loss to be paid by the respective partial owner to the wholesale broker-dealer. The effecting module  614  effects, on a recurring basis, the distributions. The reports module  616  generates reports including at least one of the determined distributions for receipt by computer systems operated by the partial owners. Generated reports may be displayed to employees affiliated with the partial owners via a user interface, such as those described above. Exemplary reports are described above with respect to  FIGS. 4 and 5 . 
       FIG. 7  is a flow chart of a method  700  for enabling partial owners of a wholesale broker dealer to participate in providing investment products, according to an illustrative embodiment of the invention. The method begins with storing reports of wholesale fees received by a wholesale broker-dealer for providing the wholesale support services to registered representatives of a retail broker-dealer (step  702 ) and storing reports of expenses incurred by the wholesale broker-dealer in relation to providing the wholesale support services (step  704 ). The registered representatives are affiliated with the partial owners. Exemplary reports are described above with respect to  FIGS. 4 and 5 . Next, the wholesale fees and the expenses are allocated among the partial owners (step  706 ). Various types of revenues and expenses and systems and methods for their allocation are described above with respect to  FIGS. 1-6 . At step  708 , a distribution is determined for each partial owner based on a difference between the wholesale fees and the expenses allocated to the respective partial owner. In some embodiments, the distribution received by a partial owner is equal to this difference. A distribution is either a profit or loss, depending on whether allocated revenues exceed allocated expenses for a particular partial owner. At step  710 , the distributions are effected, resulting in either a payment of profits from the wholesale broker-dealer to the partial owner or the partial owner paying the amount of the loss to the wholesale broker-dealer. Systems and methods for determining and effecting distributions are described above with respect to  FIG. 1-6 . 
     The invention may be embodied in other specific forms without departing from the spirit or essential characteristics thereof. The foregoing embodiments are therefore to be considered in all respects illustrative, rather than limiting of the invention.