ING Financial Partners Compensation and Strategic Partners

ING Financial Partners Compensation and Strategic Partners

Compensation

ING Financial Partners, through your registered representative, makes a wide variety of mutual funds and variable insurance products, including annuities, available to you. You pay either a sales charge when you purchase your investments (such as for Class A shares of a mutual fund), or the sales charge may be built into the expenses of the product and/or charged to you when you sell (such as for Class B or C shares of a mutual fund). ING Financial Partners is paid by the product issuer or its affiliates, and part of that payment goes to your registered representative.

Your sales charges and expenses, and the sales commissions paid to us and our representatives, differ from investment to investment, and may depend on the amount of money you invest. Some product issuers or their affiliates occasionally also offer “commission specials,” which increase the sales commissions paid to us and our representatives. Sales charges, and information about expenses, are explained in the product’s prospectus. Generally speaking, investors buying the same product for the same kind of investment account with the same investment amount pay the same sales charge. This is true regardless of the broker-dealer and registered representative through which the investment is purchased.

Your representative may receive extra compensation for or may concentrate efforts on the sales of ING products. ING Financial Partners may share with registered representatives and/or manage a greater percentage of the compensation it receives on ING products. Additionally, ING Financial Partners may also pay registered representatives who are life insurance agents bonuses and/or benefits based on sales of ING variable life and annuity products.

Our Strategic Partners

Although we make a large number of products available to you, we concentrate our marketing and training efforts on investments offered by a number of select companies (“Strategic Partners”). Strategic Partners are selected, in part, based on whether they offer competitive products, their technology, their customer service and their training capabilities. Some of our Strategic Partners are members of the ING family of companies.

Our Strategic Partners have more opportunities than other companies to provide our customers and our representatives with education on investments, the products they offer, industry trends, new investment ideas and other issues.

They may attend or sponsor education and training meetings for our representatives. Our Strategic Partners also have the opportunity to receive input from our representatives on features of their products. As discussed below, our Strategic Partners pay additional amounts to ING Financial Partners to compensate us for these enhanced marketing and training opportunities.

What Strategic Partners pay to ING Financial Partners

It is important to know that although Strategic Partners pay extra compensation to ING Financial Partners or its affiliates; you do not pay more to purchase Strategic Partner products through ING Financial Partners than you would pay to purchase those products through another broker-dealer. Nevertheless, the payment of this additional compensation to ING Financial Partners by our Strategic Partners may pose a financial incentive for us to promote those products over other products.

The additional amounts Strategic Partners pay ING Financial Partners vary from one Partner to another and from one product to another. For example, a significant portion of these payments can be calculated as a fixed amount, as a percentage of product sales (up to a maximum of 1/4 of 1%—which would be $25 on a $10,000 investment), as a percentage of our customers’ assets invested in the products (up to a maximum of 1/10 of 1%—which would be $10 on a $10,000 investment), or as some combination of these. The prospectus and statement of additional information for each mutual fund or variable insurance product should have additional information about these payments.

Benefits to ING Financial Partners’ representatives

Your representative does not receive additional commissions for selling a Strategic Partner product, except when from time to time ING Financial Partners allows its representatives to participate in “commission specials” offered by Strategic Partners. To find out whether a product you are considering is part of a commission special, ask your representative or visit the product issuer’s Web site.

ING Financial Partners’ representatives do receive some additional benefits from our Strategic Partner program. In some cases the transaction clearing costs that would normally be paid by you or your representative may be reduced or eliminated on Strategic Partner products. Also, your representative indirectly benefits from Strategic Partner payments to ING Financial Partners when this money is used to support costs relating to product review, marketing or training.

Other compensation and reimbursements

Companies that are not Strategic Partners may at times send ING Financial Partners payments in recognition of our sales and marketing efforts, and may have additional opportunities to provide marketing services to our representatives. Also, both Strategic Partners and other companies may pay marketing allowances to ING Financial Partners in connection with the sale of insurance products. Both Strategic Partners and other companies may also reimburse up to 100% of the cost of training and education meetings for our representatives, as permitted by industry rules. Sales of any products by ING Financial Partners representatives may qualify representatives for additional cash and non-cash compensation that may include support for their business activities, attendance at seminars, conferences and entertainment. Additionally, some investments, whether they are issued by a Strategic Partner or not, may pay higher rates of compensation than others. Further, some of ING Financial Partners’ home office management and certain other employees may receive a portion of their employment compensation based on sales of products of Strategic Partners, including ING affiliates.

ING Financial Partners does from time-to-time add or remove specific firms from its Strategic Partners Program. Below is the current list of Mutual Fund and Insurance Strategic Partners:

Mutual Fund Strategic Partners:

  • Allianz Mutual Funds
  • American Funds
  • Blackrock Investment Management
  • DWS Scudder Investments
  • Fidelity Advisor Funds
  • Franklin Templeton Investments
  • Hartford Funds
  • ING Funds
  • ING Select Advantage (PW: Advantage)
  • Invesco Aim
  • John Hancock Funds
  • JP Morgan
  • Oppenheimer Funds, Inc.
  • PIMCO
  • Pioneer Funds
  • Putnam Investments
  • Prudential Mutual Funds

Insurance Strategic Partners:

  • AXA Equitable Life
  • Fore Thought 
  • ING Annuity & Asset Sales
  • ING/Reliastar
  • Jackson National Life
  • Met Life Investors
  • Nationwide
  • Pacific Life
  • Prudential
  • SunAmerica Annuity & Life Assurance Co.
  • Transamerica

Alternative Investment Companies

In addition to the Strategic Partners described above, certain distributors of units in SEC-registered public and non-SEC-registered non-public non-traded Real Estate Investment Trusts and Direct Participation Programs, shares of non-traded common stock, corporations, and shares of Regulation D offerings may pay additional amounts to ING Financial Partners to compensate the firm for enhanced marketing and training opportunities.

It is important to know that although certain distributors pay extra compensation to ING Financial Partners or its affiliates, you do not pay more to purchase these products through ING Financial Partners than you would pay to purchase those products through another broker-dealer. Nevertheless, the payment of this additional compensation to ING Financial Partners by these distributors may pose a conflict of interest and/or a financial incentive for the firm to promote those products over other products.

The additional amounts distributors pay ING Financial Partners vary from one to another and from one product to another. For example, a significant portion of these payments can be calculated as a fixed amount or as a percentage of product sales (up to a maximum of 1.5%—which would be $150 on a $10,000 investment). Please read the prospectus and statement of additional information for each product to learn more about these payments.

Your representative does not receive additional commissions for selling one of these products. Your representative may attend a training and education meeting to learn more about these products, the investment features they contain, and general industry or market trends.

Below is the current list of companies that issue alternative investments that compensate the firm for enhanced marketing and training opportunities:

  • American Realty Capital Trust
  • CNL
  • Cole Capital
  • Dividend Capital
  • Franklin Square Capital (FS2 Capital)
  • Griffin Capital
  • Hines Real Estate Investments
  • ICON Securities
  • Inland Securities
  • KBS Capital Markets
  • MDS Energy Development
  • Northstar Realty Finance
  • Realty Capital
  • Resource Real Estate
  • Steadfast Real Estate
  • Steben & Company
  • W.P. Carey