Cetera Advisor Networks has something to cheer about for a change.

The beleaguered IBD, whose parent company, RCS Capital, is undergoing bankruptcy proceedings, has recruited Empire Asset Management Group, an Albany, N.Y., hybrid independent advisory firm, to its IBD platform.

After performing "a thorough search" for a new broker-dealer, Empire concluded that Cetera was "the best answer" for future growth, said Brad Konopaske and Paul Paska, Empire's founder and president, respectively, in a statement.

Cetera will also be able to help Empire acquire new practices, "especially those owned by older advisors seeking an exit strategy," the executives said.

Konopaske and Paska were not available to comment on what, if any impact, RCS Capital's bankruptcy had on their decision.

REGISTERED SINCE DECEMBER

Empire, which manages approximately $200 million in client assets, has been registered with Cetera since December 2015, according to FINRA BrokerCheck records.

"Empire started looking at us a couple years ago," says Douglas King, Cetera Financial Advisor Networks' CEO. According to King, discussions of this partnership began earlier this year. Empire commenced their transition to Cetera in February 2016 and only recently completed the process.

RCS Capital, Cetera's parent company, filed for Chapter 11 bankruptcy in January this year and took the nation's second largest independent financial advisor network private under a new corporate restructure.

Since then, a number of advisors have left Cetera. Early this year,  40 Cetera advisors parted ways with the network, citing uncertainty around the bankruptcy.

RETENTION ISSUES

King acknowledges that advisors have asked questions about the bankruptcy proceedings.

"However, once we sit down and show them the separation between Cetera Financial Group and RCS Capital, they get it and understand," King says.

Cetera also acknowledges that there has been advisor movement, but attributes it to normal industry fluctuation. 

"While the future for Cetera’s more recently acquired firms is less certain, the core network has always enjoyed a very loyal advisor following," said Jeff Nash, a financial service industry consultant, in a statement.

In addition, the U.S Bankruptcy Court has approved a sale of interest in Docupace Technologies, a technology solutions company acquired by RCS Capital in 2014. Under the $9 million sale agreement, Docupace will continue to provide its services to Cetera under a new five-and-a-half-year extension.

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