Big LPL Team Reverses Course, Joins Ameriprise Employee Unit
(Updates with comments on team’s reasons for joining Ameriprise employee channel.)
In an increasingly rare shift away from independence, a large team of brokers in Louisiana who had a 16-year affiliation with LPL Financial has shifted course to become employee-channel brokers at Ameriprise Financial.
The 15-person team, which includes nine advisors, is led by Michael Upton, Jeffrey Draughon, Joseph Bollinger and Samuel Marino, Jr., and has offices in three Bayou State locations. The team, which will continue to market itself as UDB Financial, was managing about $633 million of customer assets prior to their move from LPL last week, Ameriprise said.
Upton, Draughon and Bollinger shaped their careers as Edward Jones brokers in the mid-1990s before moving to independence by opening an LPL office in the central Louisiana town of Alexandria in January 2003. Upton and Draughon, whose fathers were partners in a rare two-advisor Jones office in the town, inherited the business and joined their practice with Bollinger’s in Leesville, La., at LPL.
Marino spent a rookie month as a broker in 2007 with Merrill Lynch in Baton Rouge before setting up a branch for the team in that city in October of that year.
“After 16 years of being independent, we grew weary of ‘running the business’ and wanted more time to spend with our clients,” Draughon wrote in an e-mail. “We felt the time and financial costs of ‘keeping up’ was becoming challenging.”
The team declined to discuss production numbers, but in 2018 Draughon and Bollinger qualified for LPL’s top-tier Chairman’s Club while Upton and Marino were in lower-level recognition tiers.
Draughon said the partners spent years exploring alternate affiliation options as independent brokers and W-2 employees, settling on Ameriprise because even its employee channel has “an independent feel” and citing corporate benefits for all team employees as well as a succession plan “that would have been difficult to re-create on our own.”
Their practice includes advisors Brian Flynn, Stanley Bollinger, Crissy Shirley, John Lenahan, and Lori Decker, as well as support staff Heather Parker, Shirley Laurence, Monica Meche, Martha Bankston, Ann Murray and Kimberly Braddy—each of whom had been at LPL.
A spokeswoman for LPL did not immediately return a request for comment on the team’s move.
Ameriprise, whose roots with predecessor firms IDS and American Express lie in selling insurance, annuities and asset management products to working-class Americans, has been generating an increasingly growing portion of its revenue and profit from its brokerage unit, which contributed 48% of its pretax 2018 operating earnings.
It also has been targeting wealthier customers and fattening recruiting deals in an attempt to draw experienced brokers. Its average advisor generated $620,000 in fees and commissions in 2018—up 9% from $569,000 in 2017 but below the million-dollar-plus production figures reported by wirehouses such as Morgan Stanley Wealth Management, UBS Financial Services and Merrill Lynch.
Ameriprise has been recruiting into its independent channel at a faster pace than into its employee-broker channel. The Minneapolis-based company ended 2018 with a brokerage force of 9,931, up a net 35 from 12 months earlier. About 22% of its brokers, or almost 2,200, work in its employee channel.
Manish Dave, senior vice president in charge of recruiting, said in an interview on Wednesday that the firm’s recruiting and prospecting has heated up this year.
“The volatility we all experienced in the fourth quarter served as some version of a wake-up call for advisors, who are shaking off the complacency that develops over many years of a bull market,” Dave said. “It’s prompted many advisors to get back into more of a decision-making mode.”
He declined to provide specific numbers of year-to-date hires but said figures are “substantially higher” than in 2018.
Not all decisions by brokers are going Ameriprise’s way. A three-advisor team in Wall Township, New Jersey, that was was managing $800 million in client assets at the firm moved to LPL earlier this month. Senior team members Michael Bonevento and Craig Laday worked for 21 and 31 years, respectively, at Ameriprise and IDS, while their partner James Costabile spent his entire career with those firms prior to his departure for LPL.