Business Continuity Plan
(Effective Feb 2019) The purpose of this Business Continuity Plan (BCP) is to provide information to clients and other interested parties regarding BBFA (the firm) and the steps we will take in the event of a disruption to our business, either internally or externally. For questions about this plan, please contact Deirdre Torres at 805/543-4366.
I. EMERGENCY CONTACT PERSONS
In the event of an emergency, please contact the following firm principals at either the business phone 805/543-4366 or via the contact information below:
II. Firm BCP Policy/Objectives
The objective of the firm’s BCP is to respond quickly and effectively to a significant business disruption (SBD) by safeguarding employee’s lives, firm property, and the financial and other resources of clients. In the event of an SBD, we will make a prompt financial and operational assessment, quickly recover and/or resume operations as needed, and protect the firm books, records, files, and the like. We will ensure the continuity of our operations and enable clients to transact business. In the event that we determine we are unable to continue our business operations, we will assure clients prompt access to their funds and securities.
Our BCP contemplates two kids of SBD’s: internal and external. Internal SBDs affect only our firm’s ability to communicate and do business, such as a fire or flooding in an office. External SBDs prevent the operation of the securities markets or a number of firms, such as a terrorist attack or a wide-scale, regional disruption. Our response to an external SBD relies more heavily on other organizations and systems, especially on the capabilities of the custodians of our client's accounts.
Sam Blakeslee and/or Deirdre Torres is responsible for approving and executing the BCP and for conducting the required annual review. The firm maintains its BCP in its manual of procedures and procedures copies are available for inspection. An electronic copy of our plan is located on the firm’s primary server, as well as the backup server located offsite, and on our website at www.mybbfa.com.
III. Firm Business Description
We provide three separate service models. Typically, a Client will choose only one of the following service models listed below:
1) Integrated Portfolio Management and Financial Planning
2) Financial Planning Services (Hourly)
3) Brokerage Facilitation Limited
A detailed description of these services can be found in our ADV Part 2A.
BBFA offers the same suite of services to all of its Clients. However, each Client’s investment strategy and its implementation is designed based upon that specific Client’s Investment Policy Statement, which outlines each Client’s current situation (income, tax bracket, and risk tolerance).
Clients may be provided with the flexibility to impose certain restrictions and customization regarding investments in particular securities in accordance with the Client’s values or beliefs. (For example, a Client may wish to avoid certain industry sectors that a Client may find objectionable or may wish to include some preferred investments that might not otherwise be included in BBFA portfolios.) However, we reserve the right to limit such flexibility if it impacts our fiduciary or professional standards, or prevents the proper servicing of the account.
IV. Office Locations
- San Luis Obispo/Corporate Office 1101 Marsh Street
San Luis Obispo, CA 93401
- Paso Robles Branch Office 544 12th Street
Paso Robles, CA 93446
- Santa Maria/Orcutt Office
1157 E. Clark Avenue, Suite H
Santa Maria, CA 93455
V. Alternative Physical Location(s)
In the event of an SBD, we will move our staff from the affected office(s) to the closest of our unaffected office locations. If none of our other office locations is available to receive those staff, we will move them to a temporary location in San Luis Obispo within one mile of our corporate office, to the extent possible. An alternative location will be established and posted on our website if required by the circumstances.
VI. Customers’ Access to Funds and Securities
Our firm does not maintain custody of customers’ funds or securities; rather, those services are maintained by TD Ameritrade Institutional, a division of TD Ameritrade, Member FINRA/SIPC. In the event of an internal or external SBD, if telephone service is available, our registered persons will take customer orders or instructions and contact the custodian on their behalf. If web access is available, we will post a message noting that our customers may access their funds and/or securities by contacting their registered representative or any of the firm principals listed at the top of this BCP.
VII. Data Back-Up and Recovery
Our firm maintains its primary hard copy of books, records, files, including electronic records, at our corporate office, with backup materials at offsite locations. The firm principals are responsible for the maintenance of these books and records. All critical/electronic files are backed up at least daily and submitted to an offsite, secure location.
In the event of an internal or external SBD that causes the loss of our paper records, we will physically recover them from our electronic back-up systems or from our clearing broker, Wedbush Securities.
VIII. Financial and Operational Assessments
Operational Risk. In the event of an SBD, we will immediately identify the means that will permit us to communicate with our customers, employees, critical business constituents, critical banks, critical counter-parties, and regulators. Although the effects of an SBD will determine the means of alternative communication, the communications options we will employ will include telephone, voicemail, and email correspondence.
Financial and Credit Risk. In the event of an SBD, we will also 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 critical banks, and investors to apprise them of our financial status. If we determine that we may be unable to meet our obligations to those counter-parties or otherwise continue to fund our operations, we will request additional financing from our bank or other credit sources to fulfill our obligations to our customers and clients. If we cannot remedy a capital deficiency, we will file appropriate notices with regulators and immediately take appropriate steps.
IX. Mission Critical Systems
Our firm’s “mission-critical systems” are those that ensure prompt and accurate processing of securities transactions, including order taking, entry, execution, comparison, allocation, clearance and settlement of securities transactions, the maintenance of customer accounts, access to customer accounts, and the delivery of funds and securities. More specifically, these systems include direct internet site access to the TD Ameritrade Institutional database. The internet site database allows our firm to processes securities transactions, verify client account information, and allow for customer account access and delivery of funds and securities.
We have primary responsibility for establishing and maintaining our business relationships with our customers and have sole responsibility for our mission-critical functions of order taking. The custodians provide the comparison, allocation, clearance, and settlement of securities transactions, the maintenance of customer accounts, access to customer accounts, and the delivery of funds and securities.
The custodian contract provides that they will maintain a business continuity plan and the capacity to execute that plan. The custodian represents that it will advise us of any material changes to its plan that might affect our ability to maintain. In the event that the custodian executes a plan, it represents that it will notify us of such execution and provides us equal access to services as its other representatives. If we reasonably determine that the custodian has not or cannot put its plan in place quickly enough to meet our needs, or is otherwise unable to provide access to such services, our firm represents that it will assist us in seeking services from an alternative source.
The custodian represents that it backs up client records at a remote site. The custodian represents that it operates a back-up operating facility in a geographically separate area with the capability to conduct the same volume of business as its primary site. The custodian has also confirmed the effectiveness of its back-up arrangements to recover from a wide scale disruption by testing every six (6) months.
Recovery-time objectives provide concrete goals to plan for and test against. They are not, however, hard and fast deadlines that must be met in every emergency situation, and various external factors surrounding a disruption, such as time of day, the scope of disruption, and status of critical infrastructure – particularly telecommunications – can affect actual recovery times. Recovery refers to the restoration of clearing and settlement activities after a wide-scale disruption; resumptions refer to the capacity to accept and process new transactions and payments after a wide-scale disruption. The custodian has the following SBD recovery time and resumption objectives: the recovery time period of 4 hours maximum and resumption time of same business day
Our Firm’s Mission Critical Systems
- Order Taking
Currently, our firm receives orders from customers via telephone or in person visits by the customer. During an SBD, either internal or external, we will continue to take orders through any of these methods that are available and reliable, and in addition, as communications permit, we will inform our customers when communications become available to tell them what alternatives they have to send their orders to us. Customers will be informed of alternatives by telephone. If necessary we will advise our customer to place orders directly with our clearing firm at Wedbush Securities.
- Order Entry
Currently, our firm enters orders electronically through the custodian's website or by a telephone call to the custodian directly.
In the event of an internal SBD, we will enter and send records to the custodian by the fastest alternative means available, which include telephone correspondence. In the event of an external SBD, we will maintain the order in electronic or paper format, and deliver the order to the custodian by the fastest means available when it resumes operations. In addition, during an internal SBD, we may need to refer our customers to deal directly with their custodian for order entry.
- Order Execution
We currently execute orders electronically or directly by telephone to the custodian. In the event of an internal SBD, we would log in or call from an alternative location. In the event of an external SBD, we would call an alternative location.
X. Alternative Communications Between the Firm and Customers, Employees, and Regulators
We now communicate with our customers using the telephone, fax, U.S. mail, email, and in-person visits at our firm or at the other location. 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 (oral or written) 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 a paper copy in the U.S. mail.
We now communicate with our employees using the telephone 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 oral means that we have used in the past to communicate with the other party. We will also employ a call tree so that senior management can reach all employees quickly during an SBD. The call tree includes all staff home and office phone numbers. We have identified persons noted below, who live near each other and may reach each other in person.
Caller Call Recipients Deirdre Torres
Sam Blakeslee, Craig Darnell, Tricee Wright, Chris Coates
Stephen Hiltscher, Jessica Roberts, David C
Ashaki Smith, Eddie Comacho, Kara Woodruff
David Cryden Jodie Daniels
XI. Critical Business Constituents, Banks, and Counter-Parties
We have contacted our critical business constituents (business 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 an SBD to them or our firm. Our major suppliers are:
TD Ameritrade Institutional
200 S 109th Ave,
Omaha, NE 68154-2631
Digital West (SLO)
1998 Santa Barbara Ave #100
San Luis Obispo, CA 93401
250 Bridge Street
San Luis Obispo, CA 93401
142-198 E Main Street
Santa Maria, CA 93444
3220 S. Higuera Street #325
San Luis Obispo, CA 93401
545 12th. Street
Paso Robles, CA 93446
21362 Vista Estate Drive
Lake Forest, CA 92630
We have contacted our critical banks and lenders to determine if they can continue to provide the financing that we will need in light of the internal or external SBD. The bank maintaining our operating account is: Pacific Premier Bank 1144 Morro Street, San Luis Obispo, CA 93401 (805) 549-7200. If our banks and other lenders are unable to provide the financing, we will seek alternative financing immediately from Pacific Premier Bank 545 12th Street, Paso Robles, CA 93446 (805) 369-5200.
We have contacted our critical counter-parties, such as other broker-dealers or institutional customers, to determine if we will be able to carry out our transactions with them in light of the internal or external SBD. Where the transactions cannot be completed we will contact those counter-parties directly to make alternative arrangements to complete those transactions as soon as possible.
XII. Regulatory Reporting
Our firm is subject to regulation by SEC and the Department of Corporations. We now file reports with our regulators using paper copies in the U.S. Mail and electronically using fax, email and the internet. In the event of an SBD, we will check with the SEC 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
We disclose in writing a summary of our BCP to customers at account opening (for existing clients will disclose in annual mailing). We also mail it to customers upon request. Our summary addresses the possibility of a future SBD and how we plan to respond to events of varying scope. In addressing the event of varying scope, our summary (1) provides specific scenarios of varying severity (e.g., a firm-only business disruption, a disruption to a single building, a disruption to a business district, a city-wide business disruption, and a regional disruption); (2) states whether we plan to continue business during that scenario and, if so, our planned recovery time; and (3) provides general information on our intended response. Our summary discloses the existence of back-up facilities and arrangements.
XIV. Updates and Annual Review
Our firm will update this plan whenever we have a material change to our operations, structure, business or location or to those of our clearing firm. In addition, our firm will review this BCP annually, to modify it for any changes in our operations, structure, business or location or those of our clearing firm.
XV. 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.