When LPL Financial's presumed heir apparent, President Robert Moore, left the company last week, the move appeared abrupt.

But in truth, tension had been building in the executive suite, insiders say. And Moore's departure, they add, seemed to be the result of an internal rivalry with the man who replaced Moore as president: Dan Arnold, who had served as LPL's chief financial officer since 2012.

Moore, 53, was a financial services veteran who had just completed two years as CEO of LaSalle Bank in Chicago -- the last role in a distinguished 10-year career at ABN Ambro -- when he arrived as a high-profile recruit in 2008, two years before LPL went public.

Moore was brought in as chief financial officer, but was clearly a take-charge executive -- accompanying CEO Mark Casady, now 54, to high level meetings and field trips. In less than four years, Moore rose to become LPL president, replacing Bill Dwyer, who briefly retired and is now chief executive at Realty Capital Securities.

The widespread impression  inside the company, say current and former LPL executives and advisors, was that Moore clearly expected to succeed Casady as CEO -- with Casady's tacit, if not explicit, blessing. Both men declined comment.

ANOTHER RISING STAR

But Moore wasn't the only rising star at LPL.

Arnold, now 50, had built a stellar reputation and following as president and chief operating officer of Uvest Financial Services Group, which provided advisors, brokers and investment managers to banks and credit unions. After selling Uvest to LPL in 2006, Arnold joined the company as a managing director and head of strategy the following year.

He replaced Moore as CFO in 2012, playing an increasingly more visible role. He also emerged as LPL's point person with Wall Street, which was now following the company closely as one of the few publicly traded independent advisory firms.

Arnold -- who declined to be interviewed -- also developed a reputation as a strong behind the scenes numbers man and analytical strategist, while Moore was seen as the personable, outgoing, client-facing champion of the advisor.

"Advisors, and clients alike, really gravitated to Robert Moore," according to Abby Salameh, chief marketing officer for Morristown, N.J.-based Private Advisor Group, LPL's largest branch office. "He connected with the advisors and came with a sense of passion and enthusiasm that's hard to match."

'FALLING OUT'

There was another issue in play as well: If Moore believed Casady would soon step back to become a non-acting chairman, he was mistaken.

"I've known Mark for 25 years, and his passion is as high today as it's ever been," says Ron Carson, founder and CEO of Carson Wealth Management, a large OSJ with LPL. "He's very excited about the future."

The combination of Arnold's ascendency and Casady's staying put may have fostered tensions between Moore and Casady, some current and former executives say.

In either case, "there was a falling out" in the executive ranks, says one former high-level executive who asked not to be named.

Moore informed Casady and the board that he was leaving to become the new chief executive of institutional asset management firm Legal & General Investment Management America.

"I think Robert was brought in to become CEO [of LPL]," says Carson, who this week named Moore to join the executive board of Carson Institutional Alliance, his turnkey support platform for RIAs. "My best guess is it didn't happen on his time frame and the Chicago job became open."

CHALLENGES FOR ARNOLD

Moore is hardly the only high-level executive who has left the firm in recent years -- sometimes raising a few eyebrows on the way out. The list includes not only Dwyer but also Esther Stearns, Joan Khoury, Jeffrey Kleintop, Derek Bruton, Andy Putterman, Scott Welch, John McDermott and recruiters James Sorey, Jeffrey Draper, Joseph Line and Michael Brown.

Yet his departure may create a challenge for the company.

Marc Freedman, president of LPL affiliate Freedman Financial Associates in Peabody, Mass., says he was "shocked" to hear that Moore had resigned. "I thought Robert was doing a great job and that it was rather apparent the torch was being passed [to him] to become the next CEO," Freedman says. That said, Freedman credits Casady with building "a very deep and strong bench."

While "great with numbers," Arnold -- who studied engineering and has an M.B.A. in finance from Georgia State University -- has a "tight skill set," says one former field-level executive, who predicted the company would struggle to retain and attract big producers. "He's not a man of the people."

Recruiting will indeed be Arnold's "No. 1 challenge" says LPL branch office manager Bruce Miller -- as it would be for any new president, he adds. "It's a very competitive space, and as we transition from transaction to advisory business different skill sets and platforms will be required," Miller says.

Ironically, another major challenge for Arnold is "not having another Dan Arnold as CFO behind Dan Arnold as president," says the former senior executive. (LPL is conducting a search for a new CFO, and has named Tom Lux as acting chief financial officer.)

"Dan has all of the skill sets, but he doesn't have client relationships, and it's a relationship business," the executive says. "He needs to get out in the field as soon and as often as possible to maintain relations with important clients and advisors."

FOCUS ON BANKING

Arnold's banking background with Uvest may be a sign of things to come at LPL.

"Large financial institutions are going to play an enormous role in serving the masses over the next 10 years and LPL wants a footprint in that business," Freedman says. "The banking side is Dan's specialty."

Tom Howe, executive vice president for the Investment Services division of Webster Bank in Waterbury, Conn., agrees.

Webster worked closely with Arnold when he ran Uvest and followed the firm to LPL, Howe says. "What struck us about Dan was how advisor-focused he was and his thirst to provide advisors what they needed to succeed," Howe says. "As president he'll be responsible for customer-facing people, and that is getting back to his roots."

MAKING HIS CASE

Arnold is already making his case to LPL's annual summit meeting of top advisors this week in Hawaii, and will address another layer of high-level advisors in Florida later this month.

That leaves a few other items on his to-do list: meeting the expectations of the rest of the firm's 14,000-plus advisors, facing earnings pressure from Wall Street, compliance scrutiny from Washington, unrelenting competition from fast-growing RIAs and well-financed wirehouses and the need to keep pace with rapidly changing technology.

And, of course, he'll be measured against his predecessor as he does so.

"Robert was able to connect with advisors, had relentless energy, could grasp granular details and make decisions based on what he saw in the trenches," says Carson. "I'm hoping Dan has the same ability -- but it's way too early to know."

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