Charles Schwab is reviewing adviser participation fees within the Schwab Advisor Network, a program that generates significant new business for many Registered Investment Advisers (RIAs), according to ThinkAdvisor.

According to a disclosure brochure released by Schwab in September, advisers who benefit from referrals through the Schwab Advisor Network pay a "participation fee" based on a sliding scale tied to assets under management. The scale begins at 25 basis points for the first $2 million in referred assets, gradually decreasing as assets increase. Advisers are also subject to a one-time "program transfer fee" if referred assets leave Schwab's custody.

Schwab's decision to reevaluate fees also reflects the reputational stakes involved. Schwab's reputation is on the line with each referral, and the firm may find it more profitable to direct certain clients to their own advisers, who generally operate with higher margins.

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