400 advisors, $26B in client assets: Massive breakaway RIAs show competitive recruiting fight in indie channel

June 24, 2020 1:24 PM

Three of the largest recruiting moves and deals in the independent broker-dealer channel so far this year have involved leaving the sector completely or only joining it in a tangential way.

Some 100 recruiting announcements tracked by Financial Planning, which encompass more than 400 advisors with $26 billion in client assets, display the fierce competition for indie advisors. The 34 recruiting moves, M&A deals, strategic partnerships and research in the roundup below show IBDs aren’t exactly resting on their laurels against the threat of the full RIA channel.

IBDs are bulking up their technology platforms and growing through acquisitions. Case in point: LPL’s second deal in a month to purchase a small family-owned firm. Independent broker-dealers are also recruiting heavily. LPL, for example, has announced more than 200 incoming advisors with $10.2 billion in client assets this year. In the publicly traded firm’s first-quarter earnings, it also disclosed $8.4 billion in recruited client assets.

Even so, IBDs have found themselves on the outside looking in — or playing only a small role — in some of the biggest moves thus far in 2020.

Four advisors with $1.6 billion in client assets dropped Cetera Financial Group to fold into RIA consolidator Captrust last month.

And a wirehouse breakaway team with $1.2 billion went indie from UBS in May with the Dynasty Financial Partners platform. The practice retained a brokerage relationship with what is referred to in the industry as a “friendly BD,” in this case Purshe Kaplan Sterling Investments.

A third megamove took business away from the IBD sector and left LPL playing a bit part. In April, an LPL hybrid RIA called Wealth Enhancement Group purchased a former Securian Financial team with $1.3 billion in client assets. The co-founders have dropped their FINRA registrations, but LPL serves as one of the RIA’s five custodians.

Scroll through to see the most recent recruiting news 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 at the end of last month, click here. To see 34 recruiting moves and other news in the indie channel since then, scroll down our slideshow.

Raymond James Pride Financial Advisors Network

Location: St. Petersburg, Florida

National co-chairs: Financial advisors Tom Hake and Marta Shen:

Date of launch: June 3

BD: Raymond James Financial Services

Remark: At the beginning of Pride Month, Raymond James unveiled a new inclusion, networking and professional development group for LGBT advisors and allies. The new group joins existing Raymond James programs for underrepresented communities in wealth management, including the Black Financial Advisors Network and the Women Financial Advisors Network.

Stiles Financial Services

Location: Edina, Minnesota

Financial advisors: Susan Stiles and Keighley Spott

Total client assets: $600 million

Date of move: May 1

New BD: LaSalle St. Securities

Prior BD: Cambridge Investment Research

Remark: Stiles left Cambridge after 10 years of affiliation with the firm and seven more with Commonwealth Financial Network. The practice includes a hybrid RIA with its own wrap program for portfolio management advisory services. The seven-person practice includes a portfolio research manager and a director of retirement plan consulting.

E.K. Riley Investments

Location: Seattle

Acquiring firm: LPL Financial

Financial advisors: 35

Total client assets: $2 billion

Date of acquisition announcement: May 27

Remark: Less than a month after agreeing to buy a 20-rep IBD called Lucia Securities, LPL is tacking on another small firm to its force of nearly 17,000 advisors. The parties didn’t disclose the terms of the acquisition, but LPL says it’s paying about six times the firm’s post-synergy EBITDA. The firms anticipate the deal will close in the second half of the year. LPL will then replace Wells Fargo’s First Clearing and Fidelity Clearing and Custody Solutions’ National Financial Services as E.K. Riley’s custodian.

Lakeside Wealth Management

Location: Chesterton, Indiana

Financial advisors: Mark Chamberlain, Tim Rice, Chip Mang and Timothy VerSchure

Total client assets: $1.6 billion

Date of move: May 12

New BD: Capfinancial Securities (Captrust)

Prior BD: First Allied Securities (Cetera Financial Group)

Remark: Chamberlain’s team dropped the Cetera IBD to go full RIA as principals of Captrust. The practice includes 27 employees who are now part of the RIA consolidator’s more than 40 practices with 700 advisors across the country.

Cyndeo Wealth Partners

Location: St. Petersburg, Florida

Financial advisors: Matt Kilgroe, Tommy Kidwell, Ryan Quinty, Adam Hess and Nate Johnson

Total client assets: $1.2 billion

Date of move: June 12

Platform provider: Dynasty Financial Partners

New BD: Purshe Kaplan Sterling Investments

Prior BD: UBS

Remark: Kilgroe’s ensemble wirehouse team broke away to launch an RIA with Dynasty’s services while affiliating with PKS as its BD and choosing Fidelity Institutional as its custodian. The practice also includes a director of investments, a director of operations and five client relationship managers. Kilgroe spent 20 years with Merrill Lynch before his eight-year tenure with UBS, and several of the advisors came to the financial services after stints as professional athletes.

Nicklas Financial

Location: Jefferson City, Missouri

Financial advisors: Brandon Nicklas, Jerry Christian and Aaron Schmitz

Total client assets: $400 million

Date of move: April 30

New BD: LPL Financial

Prior BD: Securities America (Advisor Group)

Remark: The practice aligned with JFC Financial Services, the enterprise that made the largest recruiting move in the space this year by switching in early May from Securities America to LPL. In addition to Nicklas, Christian and Schmitz, the practice includes eight other advisors. Nicklas’s father founded the practice in 1979 but has since retired; his grandfather and uncle also previously worked there before their retirements.

Bain Wealth Management

Location: Salem, Oregon

Financial advisors: Frank Bain and Mark Bain

Total client assets: $100 million

Date of move: June 1

New BD: Cetera Advisor Networks (Carson Partners)

Prior BD: Purshe Kaplan Sterling Investments

Remark: In a reverse breakaway move, the family-owned practice with nine other employees affiliated with Ron Carson’s hybrid RIA and OSJ under Cetera. The practice has more than 500 clients, two-thirds of them retired.

Bellars Harris Wealth Management

Location: Virginia Beach, Virginia

Financial advisors: Tim Bellars, Claudia Bellars, Axel Bellars and Brad Harris

Total client assets: $355 million

Date of move: May 18

New BD: Raymond James Financial Services

Prior BD: Merrill Lynch

Remark: The multigenerational team includes a husband and wife and their son, along with 15-year veteran advisor Harris. Client service manager Jeannie Marie Hughes, who has 41 years of experience, also works alongside her daughter, client service associate Laura Hughes.

Broadway Graham Wealth Partners

Location: Springfield, Illinois

Financial advisors: Shane Adkins, Zach Bromley and Jay Cole

Total client assets: $370 million

Date of move: May 15

New BD: LPL Financial

Prior BD: Wells Fargo Advisors

Remark: The trio went indie from Wells Fargo with LPL’s largest hybrid RIA, Private Advisor Group. Cole, a 31-year financial services veteran, leads the practice’s retirement plan services, while Adkins specializes in planning and Bromley serves as the top investment manager and relationship builder.

PDX Wealth Management

Location: Lake Oswego, Oregon

Financial advisors: Matt Jung, Daniel Dunham and Kim Laird

Total client assets: $285 million

Date of move: May 21

New BD: Raymond James Financial Services

Prior BD: Waddell & Reed

Remark: Jung and Dunham each spent more than 15 years with Waddell & Reed before the five-member team affiliated with the Raymond James indie channel. The practice also includes Head of Training Kevin Fredrickson and Executive Associate Megan Layton.

SEI American Funds Strategies

Location: Oaks, Pennsylvania

Financial advisors: 7,600

Total AUM: $60.8 billion

Date of launch: June 1

Remark: Independent Advisor Solutions by SEI collaborated with the manager of $1.7 trillion in assets to start six outsourced strategies generally selected from American Funds by Capital Group. Indie channel advisors who use SEI’s platform can choose among low-cost, “F3” share classes in portfolios designed by the firm’s investment management arm.

Invex Financial

Location: Issaquah, Washington

Financial advisor: Susan Lawrence, Christopher Loutsis

Total client assets: $120 million

Date of move: April 22

New BD: LPL Financial

Prior BD: Wells Fargo Advisors Financial Network

Remark: Lawrence, the practice’s founder, first went indie with Wells Fargo’s IBD in 2018 after more than 20 years affiliated with the wirehouse BD. The boutique practice catering to high-net-worth clients also includes two other staff members.

Lance Pelky and Associates

Location: San Diego

Financial advisor: Lance Pelky

Total client assets: $115 million

Date of move: June 8

New BD: LPL Financial

Prior BD: Voya Financial Advisors

Remark: Pelky affiliated with LPL and its corporate RIA after 24 years with Voya’s IBD. He started in financial services in 1993 after developing his customer service skills in his earlier career in the hotel industry, according to Pelky.

Thompson Pratt Capital Management

Location: Charlotte, North Carolina

Financial advisors: Michael Thompson and Matthew Pratt

Total client assets: $110 million

Date of move: May 22

New BD: Arkadios Capital

Prior BD: Triad Advisors (Advisor Group)

Remark: Thompson had spent 5 years affiliated with Triad in his 36-year financial services career, while Pratt’s tenure dated to the last six of his 16 years in the industry. With its latest recruits, Arkadios has grown to more than 60 advisors with $3.5 billion in client assets.

Waddell & Reed’s 2020 Vision conference

Location: Overland Park, Kansas

Financial advisors: 1,316 advisors and associates

Total client assets: $51.8 billion

Date of virtual conference: June 2-3

Remark: At its annual meeting for advisors, the midsize IBD unveiled new lending, private banking and estate planning services for high-net-worth clients. BNY Mellon’s Pershing collaborated with the firm to launch them. Waddell & Reed also added more than 30 strategies around impact investing and ESG criteria to its advisory platform. The event raised more than $80,000 for homeless veterans through the Veterans Community Project.

Peter Hatzakos

Location: Holmdel, New Jersey

Total client assets: $90 million

Date of move: April 21

New BD: Royal Alliance Associates (Advisor Group)

Prior BD: HSBC Securities

Remark: The 18-year veteran advisor left the bank channel for the Advisor Group IBD, where he has also aligned with Affiliated Advisors as his OSJ. After Hatzakos affiliated with the independent producer group launched by Rita Robbins in 1994, it spans 85 advisors with more than $2.4 billion in client assets.

Gen Next Academy

IBD: ProEquities

Parent: Protective Life

Location: Birmingham, Alabama

Financial advisors: More than 600

Total client assets: $17 billion

Date of launch: May 28

Remark: The midsize IBD started a one-year mentoring and training program to place securities licensed reps in established offices. The entrants receive access to study groups, discounted CFP certification classes and other resources as they complete milestones under coaching from the mentors who are ProEquities advisors.

Richard Napolitano

Role: CEO

Company: Advisor360

Date of appointment: June 16

Prior roles: president of U.S. sales for Sun Microsystems, president of software storage division for Dell EMC

Remark: The independent subsidiary of Commonwealth Financial Network tapped a 30-year veteran tech entrepreneur and executive to run its outsourced advisor desktop company. Napolitano launched at least four firms that were later respectively acquired by Sun Microsystems, HP Enterprise, Adobe and Adaptec.

LPL’s Assurance Plan

BD: LPL Financial

Location: Charlotte, North Carolina

Financial advisors: 16,763

Total client assets: $670 billion

Date of launch: June 11

Remark: The No. 1 IBD has started a succession plan to buy practices in the case of an advisor’s death or severe disability. LPL will guarantee a minimum price in terms of the advisor’s recurring business and arrange the sale to another qualified LPL advisor at zero commissions. Any proceeds beyond the guarantee amount will go to the advisor or their family.

Cetera Workplace Financial Wellness

BD: Cetera Financial Group

Location: Los Angeles

Financial advisors: 7,659

Total client assets: $264.7 billion

Date of launch: June 16

Remark: The IBD network has rolled out a series of eight modules led by advisors to educate 401(k) participants, clients or prospects. The series covers holistic planning and specific topics like homeownership, insurance and 401(k) guidance. Cetera included the modules in its resiliency pack to support advisors through the coronavirus pandemic.

Buckley Financial Planning

Location: Liberty Township and Worthington, Ohio

Financial advisors: Fred Buckley and Sean Buckley

Total client assets: $230 million

Date of move: May 27

New BD: Commonwealth Financial Network

Prior BD: Securities America (Advisor Group)

Remark: Fred Buckley had spent 24 of his 37-year financial services career affiliated with Securities America before switching to Commonwealth. The practice caters to a niche clientele of publicly traded company executives.

Ameriprise Bank and Embrace Home Loans

BD: Ameriprise

Location: Minneapolis

Financial advisors: 9,878

Total client assets: $559.8 billion

Date of launch: June 15

Remark: Under a strategic partnership between Ameriprise and the loan provider, clients will have access to mortgage products and services. They include waived application fees, competitive interest rates, quicker application processes and a dedicated loan consultant. “Whether clients are looking for a new home or refinancing their current one, securing the right mortgage is a critical piece of their financial planning,” Ameriprise Bank President Abu Arif said in a statement.

William Newell

Location: Holliston, Massachusetts

Total client assets: $126 million

Date of move: April 1

New BD: None (Ron Carson’s RIA)

Prior BD: Purshe Kaplan Sterling Investments

Remark: Newell has dropped his FINRA license after 10 years affiliated with PKS and 17 more with LPL over his 33-year financial services career. He has now affiliated with Carson Wealth Boston, a group of three offices of Ron Carson’s RIA led by advisor Andrew Nigrelli.

Summit Street Wealth Management

Location: Oconomowoc, Wisconsin

Financial advisors: Todd Sivak, Tim Schlosser, Micah Schroeder, Luke Novak, Lauren Knop and Jeremy Wenzlow

Total client assets: $200 million

Date of move: April 17

New BD: LPL Financial

Prior BD: MML Investors Services (MassMutual)

Remark: Bank Five Nine’s investment program affiliated with LPL’s institution services division after 19 years with MassMutual’s IBD. Summit launched as an independent practice before joining the 14-branch bank in Southeastern Wisconsin in 2014.

Essa Investment Services

Location: Stroudsburg, Pennsylvania

Financial advisors: Patrick Boran, Mary Hillegas and Troy Smith

Total client assets: $218 million

Date of move: Jan. 2

New BD: Ameriprise

Prior BD: Cetera Financial Institutions

Remark: Essa Bank & Trust’s wealth management unit aligned with the Ameriprise Financial Institutions Group from Cetera’s bank channel. The practice’s new BD formed its own bank channel after acquiring San Antonio-based Investment Professionals in 2017.

Sobrinski Financial Services

Location: Sciota, Pennsylvania

Financial advisor: John Sobrinski

Total client assets: $100 million

Date of move: May 26

New BD: Cadaret Grant (Atria Wealth Solutions)

Prior BD: Triad Advisors (Advisor Group)

Remark: One of private equity-backed Atria’s five IBDs added Sobrinski and three other offices with a combined $500 million in client assets in recruiting moves this year. Sobrinski affiliated with Cadaret after five years with Advisor Group’s Triad Advisors.

Oestriecher Financial Management Services

Location: Alexandria, Louisiana

Financial advisors: Emile Oestriecher and Anne Oestriecher

Total client assets: $100 million

Date of move: April 29

New BD: LPL Financial

Prior BD: Avantax Wealth Management (Blucora)

Remark: After 20 years with the IBD previously known as HD Vest, the father-daughter practice aligned with LPL and its corporate RIA. Oestriecher’s team includes two junior financial professionals working to convert to being advisors as part of its long term succession planning.

Interchange Capital Partners

Location: Pittsburgh

Financial advisors: Ahmie Baum, Brian Baum, Kendra Kasznel Reilly, Christopher Duerr and Evan Fitzpatrick

Total client assets: $400 million

Date of move: June 12

Platform provider: Dynasty Financial Partners

New BD: Purshe Kaplan Sterling Investments

Prior BD: UBS

Remark: Baum, a 40-year veteran advisor with the wirehouse, Lehman Brothers and E.F. Hutton, launched an RIA with Dynasty’s platform and PKS as its BD. The seven-employee practice includes Baum’s son and three other advisors who operate as an ensemble with specialties in areas such as business transitions, advanced planning and relationship management.

LIMRA Secure Retirement Institute

Research report: SRI annuity forecast

Date of projections: June 17

2019 annuity sales: $241.7 billion

2020 estimated sales: $205 billion - $222 billion

2021 estimated sales: $208 billion - $225 billion

2022 estimated sales: $229 billion - $246 billion

Remark: Annuity sales will fall by between 8% and 15% in 2020 due to the falling interest rates and turmoil in equity values during the coronavirus pandemic, according to the industry research organization’s latest projections. While SRI predicts that sales will rebound in subsequent years, only registered index-linked annuities, also known as a structured or buffered product, are expected to be sold at higher volumes in 2020.

Lasalle St. Fund and Annuity Direct Help Desk

BD: Lasalle St.

Location: Chicago

Financial advisors: 300

Total client assets: $10 billion

Date of launch: June 18

Remark: Since around half of the assets managed by advisors with the midsize IBD are held outside of its platform, Lasalle St. has launched services aimed at specifically helping representatives oversee the external assets. The resources include recordkeeping, regulations and third-party product research, which the firm has elected to do instead of placing pressure on advisors to bring the assets to the corporate platform, according to the IBD. Lasalle St. also charges no fee for assets held away from the firm.

Fogarty Wealth Management

Location: Omaha, Nebraska

Financial advisors: Bennett Fogarty and Bryan Stoltenberg

Total client assets: $125 million

Date of move: June 1

New BD: LPL Financial

Prior BD: Securities America (Advisor Group)

Remark: Fogarty’s ensemble practice, which also includes operations and office managers, affiliated with LPL as its IBD and former Securities America enterprise JFC Financial Group as its OSJ.

Stephanie Link

Firm: Hightower

Title: Chief investment strategist and portfolio manager

RIAs: More than 100

AUM: $57 billion

Date of appointment: June 23

Prior role: Senior managing director and head of global equities research, Nuveen

Remark: The former Nuveen executive, co-portfolio manager of Jim Cramer’s Charitable Trust and director of research at Prudential Equity Group now leads Hightower’s investment solutions group. In that role, Link oversees Hightower’s outsourced CIO services, separately managed accounts, research, due diligence and modeling on behalf of more than 100 RIAs under the consolidator firm.

Keebeck Wealth Management

Location: Columbus, Ohio

Financial advisors: Steve Vujevich and Matthew Anderson

Total client assets: $400 million

Date of move: June 17

Platform provider: Dynasty Financial Partners

Prior BD: Merrill Lynch

Remark: Vujevich, a former Ohio State Buckeyes football player and onetime sports agent and business manager, took the practice independent with Dynasty after two decades with the wirehouse. After adding the team catering to athlete clients out of its new location in Columbus, Keebeck has reached $1.4 billion in client assets.

Atlantic Investment Advisory Group

Location: Hilton Head Island, South Carolina

Financial advisors: Marc Stuckart and Creighton Stuckart

Total client assets: $137 million

Date of move: June 3

New BD: Cetera Advisor Networks

Prior BD: Merrill Lynch

Remark: The father-son team of two Marine veterans went indie after 35 years in the employee channel, affiliating with Cetera’s largest BD and Summit Financial Group as its RIA and OSJ. The 450-advisor Summit dropped its own BD last year to fold into Cetera Advisor Networks.