AIG Advisor grabs exec from rival LPL

AIG Advisor Group has snagged a highly regarded executive from rival LPL Financial to lead two of its broker-dealers, FSC Securities Corp. and Advantage Capital Corp., both of Atlanta.

Mark J. Schlafly will be president and chief executive of both firms and report to R. Lawrence Roth, president and chief executive of AIG Advisor Group. Mr. Schlafly, who takes over at the end of the month, will oversee about 1,900 advisers.

Mr. Schlafly, a 25-year industry veteran, has never run a broker-dealer firm, but that didn’t deter AIG from hiring him, Mr. Roth said.

“He’s ready for the big job,” Mr. Roth said. “We’re really excited about this.”

The news of AIG’s hiring Mr. Schlafly was first reported on Friday morning on InvestmentNews.com.

He replaces Joseph B. “Joby” Gruber, who in April resigned from the two AIG broker-dealers after he allowed an underling to take continuing-education examinations in his name.

In 2006, LPL Financial of Boston hired Mr. Schlafly from St. Louis-based A.G. Edwards & Sons Inc., which is now part of Wachovia Securities LLC of St. Louis.

At the time, LPL was hiring a slew of top managers to bolster its roster.

At LPL, Mr. Schlafly was senior vice president of brokerage products and services, and also managed LPL’s financial planning group.

Top management at global insurance giant American International Group Inc. of New York, the parent of AIG Advisor Group, has been in flux.

Last week the parent’s board forced out its chief executive, Martin Sullivan, and named chairman Robert Willumstad to replace him. Mr. Willumstad then said he would likely recommend that the parent sell certain businesses that it’s now in or expand others.

Mr. Roth did not comment directly on possible spin-offs or acquisitions.

Instead, he said: “We’re focused on continuing our success and in contributing to the growth and profitability of AIG.”

AIG Advisor Group is one of the largest networks of independent broker-dealers in the country, with about 7,500 reps and advisers affiliated with its various firms. Last year, the group reported $1.3 billion in gross revenue.

Mr. Schlafly will have responsibilities across the network of broker-dealers, which also includes AIG Financial Advisors Inc. of Phoenix and Royal Alliance Associates Inc. of New York. He will lead the AIG Advisor Group Elite Partner program and also oversee the investment products and research group marketing functions.

“It’s good to finally see Joby’s position filled,” said Jonathan Henschen, president of Henschen & Associates Inc., a recruiting firm in Marine on St. Croix, Minn.

Mr. Henschen said that Mr. Schlafly’s experience with LPL and A.G. Edwards was more focused on products than operating a firm.

Managing the broker-dealers and meshing with the big producing reps are keys to the job, Mr. Henschen said.

Mr. Gruber’s abrupt departure in April did not disrupt the business flow of advisers with whom he has spoken, Mr. Henschen said.

But reps are wary of changes in management, he said. “Often, new people will want to make their mark, and the reps will want to see that,” Mr. Henschen said.

E-mail Bruce Kelly at [email protected].