Wells Loses Texas Veteran, Maryland Up-and-comer to Independence
A 27-year veteran of Wells Fargo Advisors in Texas and a nine-year “Top Next-Gen” Wells advisor in Maryland have jumped ship to start independent practices.
The solo practitioner, who began his career at Wells predecessor A.G. Edwards & Sons in 1993, attributed his move to frustration over client reaction to the fake account scandal that has plagued Wells Fargo & Co. for more than four years, as well as to payout penalties imposed on small household accounts and Covid-19 related restrictions on working from his branch.
Charles Marks, a 32-year-old broker in Annapolis, MD, who ranked on Forbes’ 2020 list of Top Nextgen Wealth Advisors, left Wells Fargo’s private client group employee channel after four years in late September to launch his own registered investment adviser firm, Marks Wealth Management. He said he had been managing about $300 million in client assets and generating around $2.8 million in revenue at Wells.
The fee-only advisor began his career in 2011 at Merrill Lynch, where he had been featured in promotions for its broker training program. He said he left the wirehouses over impatience with investment limitations and online marketing restrictions.
Holmes, who began his exit search in earnest two years ago, said he was particularly frustrated by penalties Wells is imposing on small accounts that it defines as those with less than $250,000, up from $100,000 a few years ago.
Other Wells advisors—including a 38-year veteran of Wells and A.G. Edwards who joined LPL Financial in June— have cited similar reasons affecting payout and client service charges for leaving the wirehouse.
“It’s about more fees and dings from the mothership,” Holmes said. “That really impacts some people—friends, neighbors and people we really care about.”
A spokeswoman for Wells declined to comment.
Wells, to be sure, is not alone in steering brokers to service wealthier accounts. Other wirehouses take similar approaches, and Minneapolis-based regional RBC Wealth Management U.S. on November 1 imposed a zero-payout on households under $100,000.
Marks, a fee-only advisor who uses Charles Schwab and Shareholder Services Group to custody client assets and provide trading and support services, said his major motivation for becoming an RIA was greater choice of investments through open technology platforms and more marketing freedom.
For example, he expects to put some clients into airline-focused ETFs that Wells had blocked, and said he is making more liberal use of social media than it and Merrill allowed.
“I kept moving because each firm was so limited,” said Marks. “Then I thought, as the saying goes, ‘If you want it done right, do it yourself.’”
Marks said that in about two months he has attracted most of his Wells’ client assets to his new shop and raised another $7 million in net new assets from clients who had been reluctant to add to their accounts amid the negative headlines about Wells’ bank scandals.