$17B in motion: 32 recruiting moves and other top indie advisor news

May 27, 2020 4:36 PM

An unprecedented public health and economic crisis hasn’t stopped hundreds of financial advisors from switching firms.

A look at 32 recent recruiting moves and news in the independent space shows that the pandemic has only taken the firms’ operations virtual rather than hindering them. If the coronavirus impeded any moves, the disruption amounted to temporary delays.

More than 300 advisors with $17.2 billion in client assets have changed broker-dealers so far this year, according to recruiting announcements tracked by Financial Planning. Out of the 10 days in 2020 with the most incoming recruits unveiled in formal press releases issued by the firms, four of them came after the U.S. outbreak of coronavirus in mid-March.

For example, an enterprise group of 50 advisors with $1.5 billion in client assets dropped Advisor Group’s Securities America to affiliate with Cambridge Investment Research on March 27. LPL Financial — which added a net 299 advisors from the year-ago period and $8.4 billion in recruited client assets in the first quarter — reeled in another enterprise from Securities America with 100 advisors and $3 billion on April 30.

Recruiting moves often come in the wake of M&A deals. The two largest moves in the sector in 2020 came after former Securities America parent Ladenburg Thalmann sold the IBD network to Advisor Group. Still, based on the publicly available information, LPL and Cambridge have added the most advisors through recruiting of any other IBDs so far this year.

Raymond James trailed those two rivals, unveiling new hires totaling at least 27 new advisors with $3.2 billion. The firm added a net 286 advisors year-over-year to its independent and employee broker-dealer units in the first quarter to reach a record 8,148 registered representatives.

Scroll through to see these recruiting moves and other notable industry items.

Note: The dates listed in each recruiting move are from official FINRA BrokerCheck records rather than the day of the company’s announcement.

For a recap on where things stood in mid-April, click here. To see 32 recruiting moves and other news in the indie channel since then, scroll down our slideshow.

Kingswood US

Prior name: Chalice Capital Partners and Chalice Wealth Advisors

Acquiring firm: Kingswood

Purchase price: $4 million

Financial advisors: 180 reps

AUM: $2 billion

Date of close: May 5

Remark: The UK-based wealth management firm bought the IBD and RIA platform and combined it with another firm called Manhattan Harbor Capital. The newly merged firm now goes by the name Kingswood US, with former Chalice Managing Partner Derek Bruton as its CEO. Kingswood is entering the American wealth management market for the first time, with an eye toward “organic growth, significant recruitment of registered advisors and acquisitions and a substantial build out of its investment banking franchise,” the company said in a statement.

Western International Securities

Location: Pasadena, California

Acquiring firm: Atria Wealth Solutions

Financial advisors: More than 400

Total client assets: $11 billion

Date of close: May 20

Other IBDs owned by Atria: CUSO Financial Services, Sorrento Pacific Financial, Cadaret Grant and Next Financial Group

Remark: The private equity-backed wealth management holding company completed its fifth acquisition since it opened in 2017. Atria’s subsidiaries now span nearly 2,500 advisors with $75 billion in client assets.

Elite Financial Management

Location: Dallas

Financial advisor: Bill Dendy

Total client assets: $415 million

Date of move: March 31

New BD: Raymond James Financial Services

Prior BD: LPL Financial

Remark: Dendy aligned the ensemble practice — which also includes registered representatives Kibb King, John Thompson and Todd Pace — with Raymond James after 15 years with LPL. Just after making the move, Elite also recruited ex-B. Riley Wealth Management advisor Bruce Lewin into the practice.

Gladstone Financial Resources Group

Location: Charlotte, North Carolina

Financial advisors: 670 registered representatives

Total client assets: $24 billion

Date of merged firm launch: May 15

BD: LPL Financial

Financial terms of merger: Not disclosed

Remark: A merger of Chester, New Jersey-based Gladstone Wealth Group’s 32 offices into Financial Resources Group Investment Services created the largest OSJ enterprise on LPL’s corporate RIA. The combined enterprise spans 155 employees and $141 million in annual revenue. Financial Resources President Bruce Miller’s team will lead the advisors using LPL’s corporate RIA, while Gladstone’s hybrid RIA provides another option for affiliation. The newly expanded OSJ also serves advisors based in banks, credit unions or other financial institutions, along with practices that are both independent and in the bank channel.

LaSalle St.’s Zero-Rate M&A Loan Program

Location: Chicago

Financial advisors: More than 300

Total client assets: $10 billion

Date of launch: April 30

BD: LaSalle St. Securities

Remark: The midsize IBD is offering its affiliated advisors direct loans from the home office with no interest and no markup fees to provide financing for succession deals ranging from around $250,000 to $750,000. LaSalle St. doesn’t require any changes of affiliation for the party on the other side of the deal. The home office will also consult with the advisors through the entire process, from finding the right seller to valuations and transactions.

Ashworth Financial Group

Location: Tryon, North Carolina

Financial advisors: Mike Ashworth, Steve Collie and Katheryn Gordon

Total client assets: $300 million

Date of move: April 1

New BD: LPL Financial

Prior BD: Wells Fargo Advisors

Remark: Ashworth’s wirehouse breakaway team became the first to go independent using LPL’s new Strategic Wealth Services, a suite of resources the No. 1 IBD is offering to employee BD reps considering independence. The practice’s founder spent a dozen years affiliated with Wells Fargo after the bank acquired Wachovia and the former A.G. Edwards BD.

FSI and ASA’s SEC rulemaking petition

Fellow signers: Competitive Enterprise Institute, New Civil Liberties Alliance

Issue: 12b-1 fee disclosure cases

Number of SEC enforcement cases: Around 100 between March 2019 and April 2020

Amount of restitution paid by firms: $139 million

Date of petition: April 29

Remark: About six months after brokerage firm trade groups FSI and ASA publicly protested what they refer to as “regulation by enforcement” in SEC enforcement cases, they filed a petition for “corrective rulemaking” to clarify guidelines around 12b-1 fee disclosures. The signees, which include pro-business advocacy groups, assert that the SEC is trying to end 12b-1 fees without federal legislation or administrative rules outlawing the widespread industry practice. The agency had embarked on a self-reporting initiative, which it said on April 20 had ended with settlements for Merrill Lynch and two other firms.

Rozovics Group

Location: Park Ridge, Illinois

Financial advisors: Jeff Rozovics

Total client assets: $50 million

Date of move: Feb. 18

New BD: Avantax Wealth Management

Prior BD: Cetera Financial Specialists

Remark: Rozovics acts as lead financial advisor for the Chicago-area CPA practice’s wealth management services. He had been affiliated with Cetera’s tax-focused IBD for 17 years prior to making the change. The firm also includes 13 tax and accounting professionals as well as five support staff.

Jon Frojen

Title: CFO

Company: Advisor Group

Location: Phoenix

Financial advisors: 11,300

Total client assets: $450 billion

Date of appointment: May 19

Prior position: CFO, United Capital

Remark: Frojen joins Advisor Group after tenures with Cetera and United Capital, where he managed the RIA consolidator firm’s finances prior to its acquisition by Goldman Sachs last year. He now reports to his new firm’s CEO, Jame Price.

Claritas Financial Partners

Location: Marlton, New Jersey

Financial advisors: Brian Lynn, John Fessler and Jim Pacheco

Total client assets: $305 million

Date of move: May 14

New BD: LPL Financial

Prior BD: Wells Fargo Advisors

Remark: The wirehouse breakaway team became one of the first to use LPL’s new Strategic Wealth Services channel aimed at catering to practices looking for independence with more home-office support. The trio launched the firm together after meeting through their prior wirehouse. Lynn had spent 17 years with Wells Fargo, while Pacheco had joined the bank after a time as a firefighter.

Waddell & Reed

Location: Overland Park, Kansas

Financial advisors: 1,316 advisors and registered reps

Total client assets: $51.8 billion

Date of Q1 earnings: April 28

Remark: The IBD’s headcount ticked down by 4% year-over-year in the first quarter, and its assets under administration slipped by 8% from the year-ago period. Despite the economic impact of the coronavirus, underwriting and distribution revenue increased by 8% to $136.9 million.

FINRA Securities Helpline for Seniors

Location: Washington, D.C.

Date of fifth anniversary: April 30

# of tips to regulators: More than 18,000 calls

Enforcement referrals: Over 1,400 to state, federal and international agencies

Disgorgement: More than $7 million returned to investors

Remark: The regulator’s assistance channel at 844-57-HELPS connects clients and advisors to FINRA staff members who can answer questions about any concerns relating to the investment accounts of seniors or vulnerable people. FINRA released a report showing the main types of products, topics and referrals from the program’s first five years.

Brian Shulstad

Title: Senior vice president of business development

Company: Triad Advisors (Advisor Group)

Location: Atlanta

Financial advisors: More than 600

Date of appointment: April 6

Prior position: vice president of business development, LPL Financial

Remark: Shulstad joined the hybrid RIA-focused IBD in the Advisor Group network after a dozen years with LPL, A.G. Edwards and H&R Block Financial Advisors. In the new role, he reports to Triad Chief Strategy Officer Nate Stibbs.

FPA’s rebranding

Members: More than 22,000

Chapters: 86 local chapters and two state councils

Date of new website launch: May 21

New membership categories: Aspiring financial planner and new to the profession financial planner

Remark: The organization made its new website live as it aimed for a “complete revamp of the communications, logo, graphics and messaging for FPA and its nationwide network of chapters,” according to a news release. Members can use the site for services like the organization’s online planning discussions, FPA Knowledge Circles and other virtual groups. The new levels of membership aren’t available to current members, but the organization says they’re priced at a more affordable rate with a more feasible timeline.

Ron Carson’s new book

Title: “Proven in the Trenches: 11 Principles to Maximize Advisor Value and Transform Your Firm’s Future”

Practice name: Carson Group

Partner offices: More than 120

Total AUM: More than $12 billion

Date of new book announcement: April 20

BD affiliation of OSJ: Cetera Advisor Networks

Remark: The founder of Carson Group released his first book since 2012. The latest one provides “an actionable game plan touching on the core dimensions of a highly-functioning financial services firm,” according to the firm.

Osborn Williams & Donohoe

Location: Cincinnati

Financial advisors: David Osborn and four other advisors

Acquiring firm: Hightower

Total client assets: $1.4 billion

Date of deal announcement: May 5

Remark: The RIA consolidator unveiled its second acquisition this year. It is expected to close in the third quarter, at which time Hightower will have a total of 107 RIA practices in 34 states. Osborn’s practice has 15 employees and roots dating to 1902.

LPL’s new digs

Location: Austin, Texas

Financial advisors: 16,763

Total client assets: $670 billion

Date of announcement: May 13

BD: LPL Financial

Remark: LPL took a space in a development called Paloma Ridge in Northwest Austin. Adding the new office to its existing corporate footprint in places like San Diego, Boston and outside Charlotte, North Carolina, will give “greater access to a workforce that will further support the firm’s continuous delivery of innovative technology solutions,” according to the firm.

Ameriprise

Location: Minneapolis

Financial advisors: 9,878 (2,102 employee advisors and 7,776 independent advisors)

Total client assets: $560 billion

Date of Q1 earnings: May 6

Remark: Despite the stock-market impact of the coronavirus pushing down client assets by 5% year-over-year, Ameriprise’s wealth management unit boosted its pretax adjusted operating earnings by 8% to $378 million for the quarter. The firm’s headcount slipped by 101 reps compared to the year-ago period. At least 80 advisors affiliated with the firm in the first quarter.

Steve Chipman

Title: Senior vice president of strategic initiatives

Company: Cambridge Investment Research

Location: Fairfield, Iowa

Financial advisors: 3,400

Total client assets: $114 billion

Date of appointment: April 20

Prior position: Senior vice president of strategic acquisitions, Advisor Group

Remark: Chipman joined Cambridge to help the privately-held firm explore more potential strategic acquisitions amid record consolidation in wealth management of recent years. His 25 years of experience includes tenures with Advisor Group, Pershing and Foothill Securities, as well as a term on FSI’s board.

SCO Wealth Management

Location: Bel Air, Maryland

Financial advisors: Michael Schenking, Zachary Chryst and Thomas O'Conor

Total client assets: $355 million

Date of move: March 27

New BD: Wells Fargo Advisors Financial Network

Prior BD: Merrill Lynch

Remark: Schenking had spent more than three decades with the wirehouse before going indie with Wells Fargo’s IBD channel, while Chryst had been with Merrill for 20 years.

Life Certain Wealth Strategies

Location: Greenwood Village, Colorado and Colorado Springs

Financial advisors: Joseph Di Biasi and Gregory McElheny

Total client assets: $170 million

Date of move: Feb. 21

New BD: Woodbury Financial Services (Advisor Group)

Prior BD: MML Investors Services (MassMutual

Remark: Di Biasi and McElheny affiliated with Woodbury while acquiring fellow advisor Herb White’s practice as part of a succession plan ahead of White’s retirement. Including the new recruits, Life Certain manages $410 million in client assets.

Waddell & Reed

Locations: Indianapolis, Lake Havasu City, Arizona, Sherman Oaks, California and Rancho Cucamonga, California

Financial advisors: Brett Ramsey, Robert Espy, Derek Butler and Andrew Chabot

Total client assets: $236 million

Date of move: March 30-May 1

New BD: Waddell & Reed

Prior BD: LPL Financial, Edward Jones and Avantax Wealth Management

Remark: Three of the four advisors came from rival IBDs, and Espy went indie from the employee sector. The separate practices generated annual production of $1.7 million combined with their prior firms.

Winston Wealth Advisors

Location: Dallas and Lubbock, Texas

Financial advisors: David Winston, Ashley Hougland, Tara Kincaid and Jacob Winston

Total client assets: $300 million

Date of move: May 1

New BD: LPL Financial

Prior BD: Securities America (Advisor Group)

Remark: Founder David Winston had spent 13 years with Securities America and 13 more with American General Securities before affiliating with LPL. The four advisors, including Winston’s son, are using LPL’s corporate RIA.

Cutler Andrews Capital Management

Location: Greenwich, Connecticut

Financial advisor: Sheila Spicehandler

Total client assets: $100 million

Date of move: Feb. 21

New BD: Wells Fargo Advisors Financial Network

Prior BD: Ameriprise

Remark: Spicehandler joined an existing practice at FiNet after nine years with Ameriprise, two with Morgan Stanley and 10 with Citigroup.

WaddellOne

Location: Overland Park, Kansas

Financial advisors: 1,316 advisors and registered reps

Total client assets: $51.8 billion

Date of upgrades to advisor workstation: May 14

BD: Waddell & Reed

Remark: The IBD launched a new digital repository for all client data and another database for company workflow questions as part of its main advisor workstation. Refinitiv’s Thomson One built the platform for Waddell & Reed under a series of moves in recent years away from the IBD’s legacy model as a distribution arm for funds.

Lincoln Level Advantage

Issuer: Lincoln Financial Group

Location: Radnor, Pennsylvania

Distribution: More than 7,000 advisors and other registered representatives

Product type: Registered index-linked annuity, also known as a structured or buffered annuity

Date of new features: May 18

Remark: As issuers adjust their products in response to the economic crisis from the coronavirus, Lincoln’s flagship indexed variable product added a 10% level of protection tied to the S&P 500 Index with a one-year term. It also has a 20% level with the same term.

LPL’s Advisor Sleeve

Assets under management: $2 billion

Centrally managed platform: Model Wealth Portfolios

Total centrally managed assets: $46.9 billion

Centrally managed assets as % of AUM: 14.5%

Date of milestone: May 14

IBD: LPL

Remark: Nearly a year after giving its 16,700 advisors the ability to alter the firm’s model portfolios, LPL said the program had topped $2 billion in assets. LPL is betting that affiliated advisors will be enticed to its centrally managed platforms with greater flexibility and ease of use on its tech infrastructure.

Kestra Financial

Location: Austin, Texas

Financial advisors: 15

Total client assets: $1.4 billion in client assets

Date of moves: Q1

Remark: Kestra added to its ranks of more than 1,700 advisors by completing at least 10 recruiting moves in the first quarter. The incoming advisors affiliated after stints with wirehouses and other rivals, such as LPL, Cetera and Advisor Group.

Landmark Bank’s investment program

Acquiring practice: Simmons Investment Services

Financial advisors: 3

Total client assets: $400 million

Date of move: April 15

New BD: LPL Financial

Prior BD: Raymond James

Remark: The investment program of Arkansas-based Simmons Bank acquired the bank-based former Raymond James practice. It now has more than 8,000 wealth management clients with some $1.5 billion in client assets at locations in four states.

Timothy O’Connor

Location: Huntley, Illinois

Total client assets: $143 million

Date of move: April 17

New BD: Ameriprise

Prior BD: Wells Fargo Advisors

Remark: After 26 years with wirehouses, O’Connor returned to the firm where he started his career in 1987.

Avantax Wealth Management

Parent: Blucora

Location: Irving, Texas

Financial advisors: 3,945

Total client assets: $61 billion

Date of Q1 earnings: May 6

Remark: The tax-focused IBD recruited 55 advisors in the quarter, though its headcount still slipped by a net 39 reps on a sequential basis. The segment’s income nearly doubled from the year-ago period to $22.6 million, due primarily to the impact of Blucora’s acquisition of 1st Global for $180 million last year.

Structured Capital Strategies Plus

Issuer: Equitable

Type of product: Registered index-linked annuity, also known as structured or buffered annuities

Location: New York

Employees and advisors: More than 8,000

Clients: 2.8 million

Date of product enhancements: May 12

Remark: The firm previously known as AXA added features to its flagship buffered product, which it says was the first ever of its type on the market in 2010. A new feature called “Dual Direction” provides for a refund of up to the first 10% of losses in the S&P 500 Index.