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Amid sales reports, a Ladenburg IBD recruits $1B in client assets

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KMS Financial Services CEO Erinn Ford altered the Ladenburg Thalmann firm's traditional approach. Now, she's delivering on her ambitious goals.

Since her promotion from president in April, Ford has expanded the firm’s growth efforts toward recruiting more advisors in addition to its standard method of supporting its existing base. In January, she had cited $10 million in recruited production as a target goal for 2019.

After the onetime Cetera Advisors president helped recruit two practices that had been affiliated with her former firm and a third one that left Geneos Wealth Management, KMS is closing in on the fivefold increase over the previous year. The firm announced the new recruits last month.

“Being able to have that open architecture and flexibility has definitely opened up those conversations and opportunities,” she says, referring to the corporate RIA at KMS enabling advisors to choose among the industry’s four main custodians. “Advisors are known by name, not by a number,” Ford adds. “They don’t have to sacrifice culture for resources and vice versa.”

The pickups came before reports that Ladenburg is weighing a sale of the parent firm over the network of five independent broker-dealers. In an email to Ladenburg’s 4,400 advisors, CEO Dick Lampen pledged that they could inform clients it will be “business as usual” regardless.

For Ford, the business has included adding 28 more advisors in 2019. Advisors Brent Gottier of Windsor, Connecticut-based Gottier Investments and Bill Rolser of Sterling, Virginia-based Aeon Wealth Management worked with Ford at Cetera and Pacific West Securities.

“A firm’s capabilities and custodial options are important, but you also need to have the best possible home office leaders in place whom you know you can always count on,” Gottier and Rolser said in an email. “Her leadership and management style makes every advisor feel that they are the most important advisor at the firm.”

Gottier and Rolser’s practices each manage more than $100 million in client assets, and moving to KMS allowed them to retain TD Ameritrade as their primary RIA custodian. They had been with Cetera for seven years before switching to KMS in July, according to FINRA BrokerCheck.

Representatives for Cetera declined to comment on their departure.

Incoming recruits have brought production of $8.7 million in gross dealer concessions and more than $1 billion in client assets to KMS in 2019. Jennifer and Patrick Funke’s Phoenix-based practice — which has more than $230 million in assets — also affiliated in August.

In a statement, Patrick Funke noted that the practice needed “a brokerage and corporate RIA firm with a high level of retirement plan and ERISA capabilities,” and Ladenburg’s KMS has “support resources and tools in those areas that can help enhance our service offering.”

Geneos didn’t respond to a request for comment on the practice’s exit.

Patrick Funke and a longtime KMS advisor knew each other from serving on the same advisor council at American Funds, according to Ford. Patrick Funke & Associates and their new BD and corporate RIA partner found a cultural fit between the two sides, she says.

In addition to the recruiting sweep, KMS launched subscription-based planning services under an integration with AdvicePay in April. A couple of months later, the firm also hosted its first meetings of new advisor, service experience and employee councils for advisors and staff.

“Each one of those councils are providing very rich and intelligent feedback to inform our strategy moving forward,” Ford says. “To be the best firm that we can be is to unlock the potential of advisors, and most importantly, the clients.”

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