After 44 Years, a Top Washington State Broker Takes Team Independent
(Adds Tschetter’s status as a member of D.A. Davidson’s board in second paragraph.)
In another sign of the lure that independence holds even for brokerage firm veterans, a D.A. Davidson advisor who began his career 44 years ago at Merrill Lynch has set up a registered investment advisory shop with his son and a colleague in Bellevue, Washington.
Tschetter Wealth Advisors was launched on Friday by Richard Tschetter, 70, his 30-year-old son David and his partner Dustin Brumbaugh, 39, along with two client associates. In a sign of his repute at D.A. Davidson, Tschetter was appointed to the Montana-based firm’s seven-person board of directors in 2016, according to its annual report.
The decision was not will-o’-the-wisp for the elder Tschetter, who has always practiced in Bellevue, according to Brumbaugh.
“He hasn’t made too many moves other than those forced by acquisition,” Brumbaugh, who had been D.A. Davidson’s head of private client equity research prior to joining Tschetter’s group two years ago, said of his senior partner.
Tschetter worked for 11 years at E.F. Hutton and successor firm Shearson Lehman, followed by more than 16 years at Seattle regional Ragen Mackenzie Group and its ultimate acquirer Wells Fargo & Company, according to his BrokerCheck record.
He left Wells in mid-2005 to begin a 12-year tenure as one of D.A. Davidson’s biggest producers, according to a former Ragen colleague.
Brumbaugh would not comment on the team’s annual production, other than to say that it tops $2 million and comes from high-net-worth individuals and small businesses, and is largely centered on fee-based advisory accounts.
“We think D.A. Davidson is a fine firm,” he said, but “this gives us the control and the tools to tailor the client experience. The independent model today allows you to plug into a solid core platform with the open architecture to bring in the best-of-breed software.”
After due diligence that involved inspection of several independent broker-dealers and RIA custodians, the new firm, which is incorporated as DDD Partners, chose Charles Schwab as its custodian. Brumbaugh did not want to comment on the particular software plug-ins the firm is licensing to add to Schwab’s trading platform for billing, client relationship management and other functions, but said it is using the same MoneyGuidePro financial planning package the team employed at D.A. Davidson.
A spokeswoman at D.A. Davidson, whose website says it employs 760 professionals in 76 locations primarily in the northwestern U.S. and southern California, did not return a call for comment on the team’s departure.
The Tschetter moves follow the departure of four advisors from an Oppenheimer & Co. branch in Bellevue to a local independent RIA and to Stifel Nicolaus.
Moving from Morgan Stanley
In a separate but related move across the country, a team led by a younger broker who had been affiliated with Morgan Stanley in Boston for eight years set up shop over the past weekend as an independent advisory firm using Schwab as custodian.
After eight years as a Morgan Stanley advisor, Shawn Mauro said he was not able to give clients the discounts he felt they deserved or to hire the client associates he sought because his book wasn’t big enough.
“We built a good-sized practice but were getting frustrated with how siloed the wirehouse model is and with some of the restrictions,” he said.
As managing partner of LiveLife Capital Partners in Southborough, Mass., he expects to do better.
“We now have the flexibility to bring in human capital,” he said, noting that he expects his payout to rise from roughly 40% to 75% as an RIA, permitting him to recruit the help he needs and buy the software he desires.
He has already hired three associates, including Susan Fechtor, who had been at his Morgan Stanley office as a portfolio associate since 2008, and has two more employees in the pipeline, he said.
Mauro investigated moving to independent brokerage firms and other RIAs and also looked at Edward Jones, Raymond James, UBS and Merrill Lynch before concluding that the wirehouse culture is universally restrictive and that pure independence offers the best option, he said. Like the Tschetter group, Maruo narrowed his RIA custodial choices to Fidelity Investments and Schwab before opting for the latter.