The Jeffrey Matthews Financial Group, LLC
Business Continuity Plan (BCP)
Amended December 2019
I. Emergency Contact Persons
Our Firm’s emergency contact person is Jeffrey Halpert. Mr. Halpert is the Firm’s President and CEO. His contact information is:
- Business phone – (973) 805-6222 ext.500
- Cell phone – (973) 699-7700
- Business email – email@example.com
- Home email – firstname.lastname@example.org
In the event that Mr. Halpert cannot be contacted, the secondary contact is Stephen Cucchia, Chief Compliance Officer and Chief Financial Officer. His contact information is:
- Business phone – (973) 805-6222 ext.473
- Cell phone – (201) 657-0748
- Business email –email@example.com
- Home email – firstname.lastname@example.org
Mr. Cucchia the Firm’s Chief Compliance Officer and Chief Financial Officer, will review this contact information as necessary and make any necessary changes to the contact personnel or their contact information.
II. Firm Policy
Our Firm’s policy is to respond to a Significant Business Disruption (SBD) by safeguarding employees’ lives and Firm property, making a financial and operational assessment, quickly recovering and resuming operations, protecting all of the firm’s books and records, and allowing our customers to transact business. In the event that we determine we are unable to continue our business, we will assure customers prompt access to their funds and securities.
A. Significant Business Disruptions (SBDs)
Our plan anticipates two kinds of SBDs, internal and external. Internal SBDs affect only our firm’s ability to communicate and do business, such as a fire in our building. External SBDs prevent the operation of the securities markets or a number of firms, such as a terrorist attack, a city flood, or a wide-scale, regional disruption. Our response to an external SBD relies more heavily on other organizations and systems, especially on our clearing firm, the mutual fund companies and insurance companies with whom we do business.
B. Approval and Execution Authority
Mr. Cucchia, a registered principal, is responsible for approving the plan and for conducting the required annual review. He also has the authority to execute this BCP.
C. Plan Location and Access
Our Firm will maintain copies of its BCP plan and the annual reviews, and the changes that have been made to it for inspection. An electronic copy of our plan is located on The Jeffrey Matthews Financial Group, LLC server in the directory set aside for Mr. Cucchia’s documents. It is also maintained at the homes of Mr. Cucchia and Mr. Halpert and the Firm’s outside accountants, Hoberman & Lesser, LLP (212) 463-0900.
III. Business Description
Our Firm conducts business as an introducing broker-dealer on a fully disclosed basis clearing through RBC Correspondent Services (“RBC”). Our Firm does not perform any type of clearing function for itself or others. Furthermore, we do not hold customer funds or securities.
Jeffrey Matthews is a full service broker-dealer that executes orders for our customers in equity securities, options, mutual funds, UIT’s and fixed income securities. We also execute orders for our propriety account in municipal, corporate, government and money market securities. Customer orders and inter-dealer orders are documented on paper trade tickets, which are maintained on site. Checks, securities or bond coupons received are immediately sent to RBC or the coupon paying agent. RBC maintains our customers’ accounts, can grant customers access to them, and delivers funds or securities upon request.
IV. Office Locations
The Firm maintains its main office at:
30B Vreeland Road, Ste 210
Florham Park, NJ 07932
This office contains all Firm documents and all operations functions of the Firm are performed here.
The Firm also maintains nine branch offices:
200 Pemberwick Rd.
Greenwich, CT 06830
635 Palmer Avenue
West Keansburg, NJ 07734
16036 Crystal Downs E
Northville, MI 48168
9500 Koger Blvd. N
St. Petersburg, FL. 33702
5905 Airport Blvd. Suite L
Mobile, AL 36608
8335 Gayfer Road Extension
Fairhope, AL 36532
99 Cherry Hill Rd. Suite 200
Parsippany, NJ 07054
529 3rd Ave
Chula Vista, CA 91910
3677 S Huron St. Suite 101
Englewood CO, 80110
The offices in Greenwich, CT, Mobile AL, Fairhope, AL, Chula Vista CA, Englewood, CO. and West Keansburg, NJ are non-OSJ locations maintained strictly for the convenience of retail brokers and all documents are maintained in the main office. The office in St. Petersburg, FL executes principal transactions in municipal securities (proprietary trading). Both the St. Petersburg and Northville, Michigan locations are designated as OSJ’s. All original customer account documents will be maintained at the home office while copies will be maintained at the branch. All operational procedures including opening new accounts, modifying customer accounts, depositing customer funds, processing requests for customer disbursements, etc. will be performed by the home office. All retail fixed income and option transactions will be processed at the home office. Retail transactions in equity, mutual fund, and UIT transactions will be processed at the branch. The home office will maintain copies of all trade tickets. All insurance transactions will be approved at the home office and copies of all insurance contracts will be maintained at the home office.
V. Alternative Physical Location(s) of Employees
In the event of an SBD that affects our ability to access one or more of our offices, we will implement the following steps:
- If any of our branch locations are inaccessible for any reason, the individuals from these locations will conduct business from their home, or if possible, from our main office.
- If there is an SBD affecting the main office, Mr. Halpert will assess the situation and make a determination as to the projected duration of the disruption. If it is believed that the disruption will be limited in duration, employees will be required to work from their homes during the disruption. During this time, we will update our website to reflect our operating condition and the best way to contact us. We will also update our voice message to reflect the best way to contact us.
If Mr. Halpert believes the disruption will be more significant, we will operate from a back-up location. All of the computer systems we need to operate are internet based. All customer documents are scanned and maintained by RBC. Our phone service can be routed to our answering service with a single phone call to our phone vendor. Our answering service will provide the caller with a cell phone number of the broker they are calling or send an email to Mr. Cucchia who will forward the message via cell phone or email to the proper person. Based on available options, Mr. Halpert will select an appropriate back-up location from which to conduct business. Mr. Halpert and Mr. Cucchia will communicate with all employees regarding this back-up location. Our website will be updated to reflect our operating condition and best means to contact us.
VI. Customers’ Access to Funds and Securities
Our Firm does not maintain custody of customers’ funds or securities, which are maintained by RBC, mutual fund or insurance companies. In the event of an internal or external SBD, if telephone service is available, our registered persons will take customer calls and address any concerns or questions they may have. The Firm will make this information available to customers in accordance with its disclosure policy, which is maintained on the Company’s website and mailed to each customer annually.
If SIPC determines that we are unable to meet our obligations to our customers or if our liabilities exceed our assets in violation of Securities Exchange Act Rule 15c3-1, SIPC may seek to appoint a trustee to disburse our assets to customers. We will assist SIPC and the trustee by providing our books and records identifying customer accounts subject to SIPC regulation.
VII. Data Back-Up and Recovery (Hard Copy and Electronic)
Our firm maintains its primary hard copy books and records and its electronic records at 30B Vreeland Road, Suite 210, Florham Park, NJ 07932. Mr. Cucchia, Chief Financial Officer and Chief Compliance Officer, (973) 805-6222 ext.473 is responsible for the maintenance of these books and records. Our Firm maintains originals of customer account documents, copies of customer identification documents, trust agreements and similar documents. In addition to these records, the Firm maintains trade tickets, financial records such as general ledgers, balance sheets, income statements, trial balances, FOCUS reports and supporting documents, vendor records and invoices, bank records including statements, deposit receipts, canceled checks, unissued checks and bank reconciliations, commission reports, payroll records, advertising, sales literature and correspondence, personnel records, corporate records and similar documents which are also not maintained by any other entity.
RBC has agreed to maintain electronic copies of all customer documents maintained in our customer files. All existing documents have been scanned to RBC and new documents are scanned to RBC as processed. Authorized employees of Jeffrey Matthews can access this information on-line from any location. Miscellaneous incoming correspondence as well as outgoing correspondence is not archived. Copies of all internally generated reports prepared in Excel (such as commission reports), Word (such as customer correspondence), and Quickbooks (such as general ledgers and financial statements) are maintained on the Company’s server and backed-up nightly. Copies of bank records are maintained at the bank. Copies of FOCUS reports are maintained on the FINRA regulation form filing web site. Copies of personnel registration information are maintained on the FINRA CRD website.
In the event of an internal or external SBD that causes the loss of our paper records, we will do our best to recreate them from records maintained by our clearing firm, mutual fund and insurance companies, the bank, vendors and others who maintain such records. For the loss of electronic records, we will either physically recover the storage media or electronically recover data from our back-up records. If our primary site is inoperable, we will continue operations from an alternative location until the primary site is available.
VIII. Financial and Operational Assessments
A. Operational Risk
In the event of an SBD, we will immediately identify what means will permit us to best communicate with our customers, employees, critical business constituents, critical banks, and regulators. Although the effects of an SBD will determine the means of alternative communications, the communications options we will employ will include primary telephone, cell phone, website, business email, or personal email.
B. Financial and Credit Risk
In the event of an SBD, we will determine the value and liquidity of our investments and other assets to evaluate our ability to continue to fund our operations and remain in capital compliance. We will contact our partners to apprise them of our financial status. If we determine that we may be unable to meet our obligations or otherwise continue to fund our operations, we will request additional financing from our partners to fulfill our net capital obligations. If we cannot remedy a capital deficiency, we will file appropriate notices with our regulators and immediately take appropriate steps, including ceasing operations until adequate financing is arranged.
IX. Mission Critical Systems
Our Firm’s “mission critical systems” are primarily those systems that allow us to communicate with our customers, our clearing firm and other broker-dealers. Those systems include Bloomberg, MuniCenter, BondDesk, TradeWeb, Knight BondPoint, RBC’s BetaLink and Broadridge systems, Fabkom, the telephone, fax and email systems. Other systems of important including Quickbooks, our accounting software, and Microsoft Office and its associated data files. RBC, mutual fund companies and insurance companies with whom we do business are responsible for safeguarding our customer’s assets, investing those assets and ensuring their prompt distribution upon request. Each of these companies maintains a business continuity plan and the capacity to execute that plan.
Bloomberg, MuniCenter, BondDesk, TradeWeb, Knight BondPoint, BetaLink and Broadridge are proprietary systems. Should Bloomberg not be available it would be difficult to properly evaluate certain bond investments. There is no alternative to Bloomberg. Should MuniCenter, BondDesk, TradeWeb, or Knight BondPoint not be available (they are all competing trading platforms), we can use one or more of the systems that are still operational. If BetaLink or Broadridge is not available, we can communicate via the phone with RBC. If Fabkom is not available we can input directly to RBC and update Fabkom at a future date. Quickbooks and Microsoft Office data will be recovered and can be utilized from an alternate location.
X. Alternate Communications Between the Firm and Customers and Regulators
We now communicate with our customers using the telephone, e-mail, fax, U.S. mail, company website and in-person visits at our Firm or at other locations. In the event of an SBD, we will assess which means of communication are still available to us, and use the means closest in speed and form (written or oral) to the means that we have used in the past to communicate with the other party. For example, if we have communicated with a party by e-mail but the Internet is unavailable, we will call them on the telephone and follow up where a record is needed with paper copy in the U.S. mail.
We are currently members of FINRA and we are registered with numerous state securities regulators as well as several state insurance regulators. We communicate with our regulators using the telephone, e-mail, fax, U.S. mail, and in person. In the event of an SBD, we will assess which means of communication are still available to us, and use the means closest in speed and form (written or oral) to the means that we have used in the past to communicate with the other party.
XI. Critical Business Constituents and Banks
A. Business Constituents
We will contact our critical business constituents (businesses with which we have an ongoing commercial relationship in support of our operating activities, such as vendors providing us critical services), and determined the extent to which we can continue our business relationship with them in light of the internal or external SBD. We will quickly establish alternative arrangements if a business constituent can no longer provide the needed goods or services when we need them because of a SBD to them or our Firm.
We have contacted our bank to determine if they can continue to provide the services that we will need in light of the internal or external SBD. The bank maintaining our operating account is: Bank of America, 186 Columbia Turnpike, Florham Park, NJ 07932, (800) 432-1000. Bank of America is one of the largest US banks with branch locations throughout the country. If the SBD is limited to our local area, we can go to another branch location. If the SBD prohibits the Bank of America from conducting normal business activities for a short time we do not need to do anything immediately. We maintain most of our liquid assets at our clearing firm and maintain a minimum balance at the bank. If our bank is unable to provide the requisite services, we will seek an alternative banking relationship from another bank. We will fund our banking activities through the assets held at our clearing firm.
XII. Regulatory Reporting
Our firm is subject to regulation by FINRA, the MSRB, the SEC and all state jurisdictions in which we are registered. The only report we file on an ongoing basis is the FOCUS report filed with FINRA over the internet. Registration filings are prepared on an as needed basis and filed over the internet with the FINRA CRD. Other regulatory reports are only prepared upon request in the form and delivery means requested by the regulator. In the event of an SBD, we will check with the SEC, FINRA, and other regulators to determine which means of filing are still available to us, and use the means closest in speed and form (written or oral) to our previous filing method. In the event that we cannot contact our regulators, we will continue to file required reports using the communication means available to us.
XIII. Disclosure of Business Continuity Plan
Beginning in January 2007, we will provide a BCP disclosure statement to customers at account opening and annually thereafter. We will also mail it to customers upon request. Our disclosure statement is attached.
XIV. Small Firm Specific Issues
As a small firm, Jeffrey Matthews has certain unique disaster recovery issues. We have one supervisory principal and one financial and operations principal. Should something happen to one of these principals, one of the other principals could aid in the supervision process. If the financial and operations principal were not able to perform his function, the managing principals would petition FINRA for approval to bring on a temporary replacement while a full time replacement is sought. In addition to our CFO, the Firm maintains a relationship with Richard Feldman, Maven Strategic Solutions, who previously acted as our CFO. He would be able to assume the role of CFO until a replacement was hired.
XV. Updates and Annual Review
Our Firm will update this plan whenever we have a material change to our operations, structure, business or location. In addition, our Firm will review this BCP annually, by December 31, or when a material change to our BCP warrants, to modify it for any changes in our operations, structure, business, or location.
XVI. Senior Manager Approval
I have approved this Business Continuity Plan as reasonably designed to enable our Firm to meet its obligations to customers in the event of an SBD.