LPL's latest mega-influx nets $3 billion hybrid RIA

In the latest massive recruiting influx to its ranks, LPL Financial picked up a multibillion-dollar registered investment advisory firm with 74 financial advisors.

Haslett, Michigan-based CG Advisor Network, a hybrid RIA managing $3.1 billion in client assets, dropped Charles Schwab's TD Ameritrade as its primary custodian and Geneos Wealth Management as its brokerage for LPL, the firms said on April 18. The move to join the roughly 500 independent RIAs using LPL's brokerage and custodian marks the firm's sixth recruiting or M&A deal in 2023 involving an incoming advisory team with at least $1 billion in assets.

CG Advisor will offer additional custodial options besides LPL as part "our search for the best partner in the custody space," CEO Anthony Mazzali said in a statement.

"We appreciate LPL's corporate strategy and commitment to supporting large RIAs in the custodial-only space, as well as the firm's culture and attention to services and products that support both the advisor and end client," Mazzali said. "We are confident with LPL's footprint as a leading custodian, and appreciate the firm's financial commitment to the custodial and FINRA space, which gives us confidence that we are making a long-term commitment to stay as a strong partner for our advisors."

Industry News

LPL profits soar on cash earnings, influx of 1,400 financial advisors

February 3, 2023 12:54 PM

Representatives for Geneos didn't immediately respond to a request for comment. 

Representatives for Schwab declined to comment, noting a policy against discussing business relationships. Schwab is absorbing the remainder of TD Ameritrade accounts in three phases this year and a final stage in the first half of 2024 after buying the firm for $22 billion in 2020.

LPL's recruiting last year brought in nearly 1,400 additional advisors to its ranks to reach a record 21,275. That momentum has spilled over into 2023 with an array of big teams making their official transitions this year.

"We are honored this highly successful group turned to LPL in their mission to elevate their firm and be a top choice for advisors," LPL executive vice president of business development Scott Posner said in a statement. "We look forward to an exciting journey ahead with CG Advisor Network and supporting this team for years to come."

The firm's previously announced incoming mega-recruits from M&A and other additions in 2023 are: Charlotte, North Carolina-based Carnegie Private Wealth, with five advisors and $1.45 billion in client assets; South Windsor, Connecticut-based Professional Investors Network (50 advisors with $2 billion); Kansas City, Missouri-based Commerce Bank's Commerce Financial Advisors (30 advisors with $4.4 billion); West Conshohocken, Pennsylvania-based Boenning & Scattergood's Private Client Group (40 advisors with $5 billion); and Fort Mill, South Carolina-based Financial Resources Group Investment Services (800 advisors with $40 billion). 

Industry News

Ex-Wells Fargo teams form largest practice at LPL Strategic Wealth

March 6, 2023 12:29 PM

LPL's latest big pickup displays its strength among so-called hybrid RIAs, which operate their own advisory firms but use a brokerage for a portion of their business. The firm's ranks of advisors include about 5,800 at outside RIAs using an external advisory firm rather than LPL's corporate platform. Private Advisor Group, Wealth Enhancement Group and Integrated Partners represent some of the largest RIAs that retain LPL's services in that capacity.

A decision to switch brokerages or sell into a larger business involves an array of factors that vary by individual advisory teams' needs, their valuations and no shortage of emotion when thinking about a founder's legacy. Panelists in a webinar held earlier this month by M&A advisory firm DeVoe & Co. spoke about the intense process prior to any merger.

"Our number one goal is to find the very best fit," founder David DeVoe said. "We're part of the RIA community. This isn't a transaction that, you're done, you're selling your house and you go move into another one. This is your future. This is your life. This is your employees' and your clients' lives. So we really want to find that best fit."

CG Advisor's decision differs from an M&A deal in that it didn't sell any equity in the firm. Mazzali and a single team at Vestax Securities, a forerunner to LPL rival Cetera Financial Group, launched CG Advisor in 1998 and eventually built it into a branch network spanning nearly 75 advisors. The firm is moving to LPL but keeping TD and Schwab as well as Fidelity as custodial options for its teams.

"When we think about our fiduciary responsibility to the client, we believe that LPL makes a compelling partner for us because of their focus on clients and advisory firms like us," spokesman Joe Tigan said in an email. "We're confident that our new relationship with LPL will help bolster our holistic, adaptive financial planning capabilities."