UBS Cleans Merrill’s Clock

The Merrill Lynch Herd continues to head for greener pastures as two large teams depart to UBS. 

The story line has become a constant refrain as we continue to watch top wealth management teams leave Merrill Lynch in droves, literally three significant teams since September 23rd have announced their departure from the firm. Does Andy Sieg really care? Probably not as the departures represent the ethos Sieg’s management team created within wealth management at Merrill Lynch (oh I meant Merrill), abandoning what made them great in years of old. This time it is the departures of Washington DC based Slater, King & Fitzenreiter, and the New York City based Murray, Peeler & Dipaola Group, both finding a new home at UBS. 

Roger Gershman, familiar with the team/s and the UBS deals remarked, “the groups got yet another phenomenal deal with yet a different firm, UBS this time, a clear mandate that the Merrill Lynch wealth management model is no longer serving its best teams with the client service expectation teams desire to deliver to clients.” He added, “UBS is offering the only deal on Wall Street where it is 100% guaranteed with frontends and backends since there are ZERO hurdles. Hurdles of course are a mandated ‘fill or kill’ and won’t get paid so, in this market, can greatly impact advisors who transition in today’s volatile market.”

The $15 Million/$2.8 Billion Slater, King, Fitzenreiter & Murphy Group is led by Managing Director, William Slater, a multi-year recipient of the Barron’s List of America’s Top 1,200 Advisors by State.

The $7 Million Murray, Peeler & Dipaola Group six-person team is led by Senior Vice Presidents, Peter Murray (24 years at ML) and David Peeler (11 years at ML), and Senior Retirement Plan Consultant, Andrew Dipaola (13 years at ML). Other members of the team are: Joe DeLasho (4 years at ML), Senior Wealth Strategy Associate, Jane Ward, Client Service Specialist, and Drew Hanff, Client Service Specialist.  

The Gershman Group specializes in Merrill Lynch team transitions since 

the family business used to be the biggest recruiter in the country for ML PBIG and has many relationships with some of the biggest teams in the country. Gershman quotes, “we create a bidding war amongst all the banks against each other and let the biggest buyer (and best fit) win.”

“It’s a Spigot Here”- Billions Flow Out of ML This Week

You know the old saying on Wall Street “the trend is your friend?’’ Well, that is certainly the trend at Merrill/BOA. Or should we call it when it was, Merrill Lynch which was the envy of Wall Street for decades? Now it’s down to just Merrill/BOA, and then minimized down to just Merrill, a BOA company/division, and predictably will just be Bank of America alone. It’s no wonder why one resident director manager source who we spoke with on condition of anonymity “it’s a spigot here”.Even managers are now looking to exit.

Consider Roshan Ghaznavi, who also was a resident director joined UBS yesterday morning. He started at ML in 2008 and has been Resident Director of the Woodland Hills office doing $4.3M in revenues on $600M AUM. He was also part of the AGM advisory counsel at Merrill and was well respected within the group and by his colleagues at the firm. He is joined by his junior partner Matt Seukunian and 2 client associates.

Adding to the exits at Merrill, Brian Coatoam also left earlier this week. He was producing $3.6M on $560M moved to RBC from the Winter Park/Orlando area.

“Advisors from Merrill are being heavily sought after by all firms including many independent platforms,” says Roger Gershman, a recruiter who specializes in Merrill Lynch teams.
According to several of our sources of industry professionals, many advisors at Merrill are just fed up with what is clearly a major cultural shift and a different means of doing business than they have been accustomed to. A spokesperson at Merrill did not immediately return a request for comment.

“We are fielding a good amount of unsolicited calls from advisors who also care to receive top dollar for their practice and platform is best for their clients whether a bank or complete independence. “

Firms seem to be offering bigger money to ML teams than other firms with some aggressively increasing their offers for the last half of 2022. Advisors are taking notice and using this to their advantage to achieve the highest economics ever seen.

“The writing is on the wall” says another advisor in the search to exit imminently.

Another Massive High-Caliber Team Leaves Merrill

The dust is yet to settle for Merrill in DC. Last week they lost a $600M team, today Mikail Qazi and Tim Martin have decided to join UBS Private Wealth. 

Mikail is another disenchanted broker who spent the last 16 years at Merrill building his practice to over $4.2M on $500M and has been named Forbes’s best-in-state advisor for several years. He was also featured in the exclusive Next-Gen Advisors list. Both graduated in the top 1% of their classes and have earned certifications in CRPC®, CIMA®, and CFP®.

Qazi and Martin focused on advising Private Wealth Clients and will report to Julie Fox the regional director for UBS’ Private Wealth Division in the DC market. 

Roger Gershman, who has been the recruiter of choice for the Merrill Advisors looking to leave said “it’s time the firm take a good look in the mirror. There are several other Mikail’s, high-caliber, exemplary advisors looking to leave especially to UBS. We were able to execute a deal with no hurdles.” 

The Gershman Group, with over 50 years of wealth advisory recruiting. As a family company, Norman Gershman founded the firm after a 25-year career at Merrill Lynch.

“Our goal is never to urge a team to leave their current firm as the first option but only as a Plan B. Evaluating their current firm is an important part of the process.” Says Roger Gershman, the firm’s CEO who, like his dad, spent 25 years as an advisor at prestigious firms like Hambrecht & Quist and UBS PWM.

The direction of BoA has left Merrill’s herd at odds with the firm as they shift the company into a bank-centered culture. Proven by statements from Andy Sieg and the limited signings by Merrill.

Merrill Lynch’s Andy Sieg Whistles Past The Graveyard On Advisor Recruiting

There really should be memes created in honor of Andy Sieg. If there was ever a bigger corporate shill for a brand now owned by its banking overlord – it’s Mr. Sieg.

Up is down, down is up. Night is day, day is night. And the best part is, he’s so committed to the messaging that nobody other than his bosses believes.

A quick reminder that all the biggest teams and producers at legacy Merrill have been pulling the escape hatch for half of a decade now. Over and over and over again. Nearly $250B in client assets have left the firm in the past five years.

But Andy thinks that big recruiting deals are poppycock and should be frowned upon to the benefit of nameless, faceless shareholders.“We are seeing very elevated multiples for advisers as they are being recruited firm to firm,” Sieg said at the RBC Capital Markets Financial Institutions Conference. “When we see some of the levels of competitive recruiting deals, it’s very challenging that they’re going to produce threshold returns for shareholders.”This kind of inane commentary infuriates the best advisors that are left at the firm. And the thousands upon thousands of bank brokers and rookies that are replacing them are pre-programmed to fall in line.

Get out of Merrill and go get paid. Andy Sieg doesn’t care about you.

Shocking Revelations Around Merrill’s CTP Program

Major bracket Wall Street banks have only recently institutionalized substantial retirement packages for senior advisors to sunset out with very few restrictions. Inheriting advisors who care to take over these books of businesses face an enormous opportunity to convert these books, yield a solid short-term return, and a terrific long-term opportunity to own and grow these books.

However, for these inheriting advisors, the rules associated with the restrictive covenants, the non-solicitation clauses, and the timeframe to yield any return differ substantially at Merrill’s CTP program from those at Morgan Stanley’s FAP program, Wells Fargo Summit Program, and UBS’s Alpha Program.

In an interview with leading securities law expert and well-known transition recruiter, Brian Neville and Roger Gershman tackle issues associated with Merrill Lynch’s CTP program. Some shocking revelations and instant food for thought.


 

 


 

Picture of Brian J. Neville

Brian J. Neville, a founding partner of Lax & Neville LLP, has significant experience in broker/dealer, securities, regulatory defense, employment, and commercial litigation in arbitration forums and state and federal courts. He has arbitrated cases in at least 18 states and has been lead counsel on well over 500 matters.

Mr. Neville has successfully represented investors and broker-dealers in disputes involving sales practice issues and employment disputes. Mr. Neville also represents firms and registered representatives in enforcement actions by Financial Industry Regulatory Authority, Inc. (“FINRA”) (formerly the NASD and NYSE) and the Securities and Exchange Commission (“SEC”). On behalf of investors, he has recovered in excess of $50 million. On behalf of his defense clients, which tend to be individual registered representatives, management of broker-dealers or smaller/regional brokerage firms, he has successfully defended and resolved numerous cases.

 

 

 


Roger Gershman, CEO of The Gershman Group. Roger brings a wealth of experience in financial advising and asset management, Roger Gershman brings a unique advantage to the world of financial services recruiting. Having spent twenty-five years himself as a financial advisor at Hambrecht & Quist, UBS PWM, and Credit Suisse, Mr. Gershman brings a unique perspective to the recruiting and consulting world of financial advisors.

He has built profound relationships through the generations and has fostered deep relationships with his clients on both the broker and management sides. He upholds the reputation of The Gershman Group by continuing to provide valuable consultation and advice to transitioning financial advisors.

 

 

 

 

 

This is sponsored by The Gershman Group

Morgan Stanley Draws Two Merrill Private Wealth Teams with $11.8-Mln Combined in Boston and NY

Morgan Stanley on Friday reeled in a 31-year Merrill Lynch lifer in Boston and a four-broker Merrill team in New York producing $11.8 million in annual revenue combined as it continues to keep up the pressure on its wirehouse rival.

The hires followed at least two other million-dollar-plus recruits in recent weeks from Merrill, one in Cleveland and the other in the outskirts of Atlanta that represented another $5.3 million in revenue.

In the largest of the moves, Marcella “Marcie” Behman, who ranked 33rd on Forbes’ 2021 list of America’s top women advisors, left Merrill’s private wealth management office on Friday in Boston to join Morgan Stanley in Middleton, Mass., a Morgan Stanley spokesperson confirmed. She moved with four client associates: Jaclyn Snell, Mary Chase, Owen Murray, and Teddy Smith.

Behman had generated $7 million trailing 12-month revenue from $1.3 billion in client assets, according to a source familiar with her practice. She has a $4 million account minimum for new business, according to Forbes.

Behman had led the Behman Group within the firm’s private wealth unit, formerly known as the private banking and investment group (PBIG), serving ultra-wealthy clients, according to her registration records and former firm biography. She was not immediately available for comment, according to a person answering the phone at her new office.

Her former partner at Merrill, Steven T. Smith, had left in 2018 for UBS Wealth Management USA.

In the other Friday move, the four-broker New York team known as MKM Group decamped from Merrill’s private wealth management unit for Morgan Stanley.

The team, which includes Robert M. Matluck, Lee B. Konopka, Rachel B. McCormack, and Jonathan D. Moskowitz generated $4.8 million in annual revenue from $575 million in client assets, according to a source familiar with their practice. Matluck and Konopka had worked out of White Plains, New York, while McCormack and Moskowitz worked out of New York City in the Bank of America Tower, according to their BrokerCheck reports.

The most senior member of the group, Matluck, a 35-year industry veteran, started at Advest, Inc. in 1983, and worked at now-defunct technology investment bank L.F. Rothschild, Unterberg, Towbin, where he served as a senior executive, according to his LinkedIn and BrokerCheck records. He worked at Unterberg and successor firms before moving to UBS in 2009 and then Merrill in 2013, according to his BrokerCheck report.

Konopka, with 29 years in the business, started at Smith Barney in 1992 and moved to UBS in 2008, and Merrill in 2013, according to his BrokerCheck report.

McCormack had spent all of her 15 years in the industry with Merrill, according to her BrokerCheck report. Moskowitz, with 12 years of experience, started out with Collins Stewart from 2006 until October 2008, next registered with now-defunct brokerage Merriman Curhan Ford & Co. in 2010, and did stints at three other firms before joining Merrill in 2014, according to the database.

A Merrill spokesperson did not respond to a request for comment on either of the Friday departures.

The departures come as Merrill has been looking to moderate rising attrition with a series of policy tweaks, defensive measures, and spurring enthusiasm about returning to offices. A senior Merrill executive last month said the rate of competitive departures ticked back down to 3.9% in the third quarter, in-line with historical averages and down from what a spokesperson previously said was 5% in the second quarter.

Merrill has stood by a veteran broker recruiting freeze implemented in 2017 while Morgan Stanley has been aggressively hiring in recent years and CEO James Gorman last month touted the firm’s achievement of the unusual industry feat of net positive recruiting when comparing the of new hires to those who have left.

The Friday exits followed at least two other previously unreported Merrill-to-Morgan Stanley moves in recent weeks. On November 5, a producing manager for Merrill in Cleveland, Ohio who had spent his entire two-decade career with the firm parted ways with his team to join Morgan Stanley in the nearby suburb of Westlake, according to registration records.

Steven M. Rini, who started with Merrill in 2000 and had been serving as resident director since 2012, individually managed $320 million in client assets generating $1.5 million in annual revenue at his former firm, according to a source familiar with his practice.

Three advisors listed on Rini’s former team’s website, Dan A. Bragg, Steven Wickstrom, and Matthew Meyer, remain registered with Merrill, according to their BrokerCheck reports. The team was formerly known as the DBSR Wealth Management Group but now is called CLE Wealth Management, according to the Merrill website.

Rini and Bragg, who have spent all of his 43 years in the business with Merrill, did not respond to requests for comment for this story.

In Gainesville, Georgia last month, a duo of Merrill brokers who had produced a combined $3.8 million in annual revenue from $480 million in client assets also left for Morgan Stanley, according to a source familiar with their practice and registration records.

Thomas R. Johnston, a 28-year industry veteran who had spent his entire career with Merrill, and J. Thomas “Tommy” Turner, a 23-year broker who had joined Merrill in 2002 from PPA Investments, Inc. on Oct. 1 moved to Morgan Stanley to form the Johnston Turner Group, according to their BrokerCheck reports and team website.

Johnston, who ranked 14th on Forbes’ 2021 list of best-in-state wealth advisors, produced $2.5 million from $360 million of the team’s client assets while Turner produced $1.3 million from the remaining $120 million in assets, according to the source.

The Merrill spokesperson did not comment on the departures in Cleveland or Gainesville, which were confirmed by the Morgan Stanley spokesperson.

Original article: AdvisorHub

ML Herd Finds Greener Pastures in Indie

NobleVest Private Wealth is Sanctuary Wealth's Newest Partner Firm
$3.1b to Sanctuary

Merrill Lynch advisors have been looking for a newly coined term; partnered independence and no one can offer it like Sanctuary. The $3b in ML AUM over the past few months speaks to their ability to provide enough freedom for advisors to run their practice, with the flexibility to truly focus on serving clients. Welcome to the next-gen of elite advisors who are entrepreneurs at the core.

  • 8/21 Robert “Rory” O’Hara and team – $4M/$400M – Moorestown, NJ
  • 6/21 Bradley Bruce (32yr veteran) – $3M/$1.2B – Ft. Worth, TX
  • 4/21 Quorum Private Wealth (Kelly Milligan, William Michael Barry, Susan Mazzetti, Melissa Yue)  – $5M/1.5B  – Walnut Creek, CA

MIT's Sloan School and Dynasty Financial Partners Launch "Advisor to CEO Program" to Help Independent RIA Leaders Grow Best-in-Class Advisory Firms

$3b to Dynasty

Dynasty has been the leading provider of wealth management and technology platforms for independent financial advisory firms. Creating the perfect outlet to access valuable resources and industry-leading capabilities. Advisors find Dynasty to be a great fit when they are looking for efficiency to scale their operations and grow their practice. 

  • 9/21 Scott and Brett Bills, Teresa Friess, Aaron Seeman, Joshua DeLoach  – $8.8M/$1.875B  – Greenwood Village, CO
  • 3/2/21  Samuel Liebman, Matthew Liebman, Aaron Marks, Patrick Swift (Amplius Wealth Partners)  – $6M/$1.2B  – Blue Bell, PA


Perspectives - Rockefeller Capital Management

$3.4b to Rockefeller

Rockefeller continues to grow their network as it establishes new private wealth offices all across the Midwest. They have been dominating the UHNW space and feeding heavily from ML teams looking for a better name.

  • Chris Jacobs, Margot Dwyer, Stephen Randolph, Joshua Goldberg   3M/520M   Carmel, IN
  • Michael Tramontano, his son Quinton Tramontano, Robert Echavarria  (Tramontano group) 4.3M/500M  San Antonio TX
  • Mark Halcomb, Michael Frey    5M/600M   Cincinnati, OH
  • Shirley Quackenbush   2.7M/700M   Los Angeles, CA
  • John Lahoud  5.4M/500M  New  York NY
  • Dennis Bloom, Lance Williams  3.8M/600M  Olympia, WA

Review Rockefeller’s current deal



$24b to LPL Financial

LPL has been leading the Herd in the independent space for years now. Their unified vision for a single platform has made friction and complexity non-existent. Which is a breath of fresh air for the Merrill lives they’ve been recruiting.

  • Peter Shunyia – $150M – Troy, MI
  • Undisclosed name – $14.8M/$1.4b – Missoula, MT
  • Nicholas LiVecchi – $39.1M/$21b – Raleigh, NC

 

 

SURVEILLANCE: Sources Confirm That Merrill Lynch And Other Firms Monitor Advisor Bank Accounts For Suspicious Activity

In a wide-ranging interview with a legal expert in the securities industry, a revelation was made that should send shivers down the spine of every financial advisor.

Brian Neville, a well-known investment and securities attorney who routinely handles dozens of large team transitions every year, mentioned that Merrill Lynch (and others) use artificial intelligence to monitor transactions in advisor bank accounts for potential activity associated with leaving their current firm. Whoa.

After the conversation (which can be found here) we took to confirming the bombshell by speaking to sources at multiple banks. And sure enough, if you have personal accounts at the firm you work for they are watching. And the bigger the firm/bank, the more closely they are watching.

One source had this to say: “The type of activity has been going on for more than five years. The AI is used to scan for all kinds of activity across the entire bank… but adding advisor-owned accounts was an adjustment once the broker protocol exit became a thing. That change removed several legal roadblocks to keeping closer tabs on advisors.”

Another source wasn’t surprised: “This isn’t news to me, but that doesn’t mean it’s right. The environment we work in has become a 50/50 proposition – half of the time serving clients, half the time covering our own ass.”

The response to this revelation has been exceptionally strong. Advisors are looking for options that respect their work and allows them some level of mutual trust with the firm they work for… and this ain’t it.

Specific to Brian Neville and his comments, he added this as a way to combat the surveillance state of a place like Merrill Lynch, “whatever you do, don’t hold cash-heavy positions at your own firm, more so it even makes sense to hold your own investment portfolio away as well. Remove the conflict of interest altogether.”

Good advice, Brian, good advice.

Rockefeller Deal Ticks Higher, Culture Still Resonates With Biggest Teams From Merrill and Morgan Stanley

Rockefeller has had unquestioned success recruiting big teams. That’s not debatable. Every month multiple announcements find their way into the press proving that fact.

Large teams from Morgan Stanley, Merrill Lynch, and UBS continue to find the story remarkable and easy to sell to clients. Assets transfer quickly and the ‘bespoke’ feel of the firm isn’t just a narrative, but rather reality.

In a conversation with a couple of sources close to Rockefeller, it looks like their recruiting success may tick higher in the second half of 2021. Rockefeller remains highly capitalized and focused on hitting home runs on the recruiting trail.

Leaving direct quotes out of it, Rockefeller has done deals with some of the biggest upfront payments in the industry. That’s part of the reason why they remain selective with who they recruit. The teams recruit and cut big checks to transfer their assets. So there is a clear roadmap.

The above paragraph is a nice way of saying if you’re a big team you’re going to get paid at Rockefeller. Big time paid. They like to win, and based on the current recruiting scoreboard, they keep winning.

So back to the headline, yes, Rockefeller’s deal has ticked a smidge higher, as has their flexibility in constructing deals. As an example, they do a great job handling teams with retiring advisors. That flexibility has made them very successful with Merrill teams.

That success will continue. Also, keep your eyes on Chicago and Denver. Rockefeller has some big things cooking in both locations.

Top Recruiters Describe Massive Deals and Valuation – “Never seen anything like this before…”

In a weekend conversation with two well-known national wealth management recruiters a few very specific themes emerged. As the markets have remained at all-time highs and even hitting new highs throughout 2021 the market for advisors and teams is absolutely white-hot.

We took some time to deconstruct details that are making different teams exceptionally marketable and why firms like Rockefeller, UBS, and Morgan Stanley are having enormous success.

Three themes emerged: client assets have ballooned, everyone is a free agent, and bonuses are sky high while hurdles are at historic lows.

1. Client assets have ballooned to historic levels. “Clients have seen asset prices go to levels that have never been seen before. Even conservative portfolios have doubled and tripled in the past five years. That makes advisor/client relationships nearly impenetrable and assets super easy to transition,” said one of the recruiters we spoke to this weekend.

2. Everyone is a free agent. “Just five years ago more than a third of all big teams and advisors were still locked into a financial crisis-era contract. Now, nobody is. With an aging advisor population that (in the UHNW space) averages 52 years of age, a recruiting deal couple with a retirement package is the ultimate liquidity event. Those numbers climb beyond 550% at UBS and Morgan Stanley. That’s why you’re seeing large and long-tenured teams move,” said a recruiter who’s been handling large teams for more than twenty years.

3. Recruiting bonuses are sky high, while deal hurdles are historically low. “The recruiting departments across the spectrum have figured it out… traditional teams from Merrill, UBS, Morgan Stanley; they transfer their assets and they do it fairly quickly. The need for complex hurdles for assets and revenue that adds stress to a transition has largely been removed. As an example, if you are a large Merrill team and choose UBS you have zero hurdles of any kind throughout the entirety of your deal as well as their retirement package. So 550% completely stress-free. That’s unprecedented in the history of recruiting, and if you look at the data so far this year, it’s why they are leading the industry in transitioning AUM.”

Both of the recruiters we spoke with are set to have historic years that will more than double their best all-time annual numbers; again a function of asset prices and advisor revenue at epic levels. With tens of billions in client assets changing hands the fields remain ripe for harvest and the second half of 2021 doesn’t show any signs of slowing.

One final quote from one of the recruiters we spoke to this weekend: “It’s so active in every front right now. I’m working weekends and nights… so active at the highest levels. It wouldn’t surprise me if the second half of 2021 is bigger than the first half, which is saying something.”

Yes, that would be epic indeed.