Ameriprise looks to lure talent from rivals

NEW YORK — Ameriprise Financial Services Inc. says that it is finally ready to execute its long-discussed strategy to recruit registered representatives and advisers from rival firms.
To that end, this year, it has bulked up on recruiters and field talent.
Ameriprise has hired three field vice presidents, a vice president of field talent and eight recruiters. It is also offering an attractive recruiting package for advisers joining its franchisee platform.
Despite these efforts, some industry observers are doubtful that Ameriprise, the retail-brokerage unit of Ameriprise Financial Inc. of Minneapolis, will be able to accomplish its goal to make an impact through recruiting.
Known for its financial planning offerings and training of reps, Ameriprise’s platform as it stands just doesn’t stack up, some observers said.
“They’ve got a history that mainstream advisers are skeptical about,” said Danny Sarch, a recruiter in White Plains, N.Y. “What’s the sizzle there?”
The brokerage platform has flaws, Mr. Sarch said, pointing to a lack of fixed-income inventory and a relatively new outside money management platform that lacks assets.
Top money managers typically choose to work with broker-dealers that have an established platform with a strong flow of assets, he said.
“Hot money managers are in demand, and sometimes they get overwhelmed,” Mr. Sarch said. Such a platform “takes longer to build out.”
Such doubts do not faze one executive who is key to implementing Ameriprise’s strategy.

“We’re confident we can compete against anyone,” said Manish Dave, senior director of business development of the U.S. adviser group. He cited the very high payout — 55% — for its employee registered reps.
A typical payout for an employee rep at a wirehouse or regional firm is between 35% and 45% of gross production.
Mr. Dave also shot down the criticism that Ameriprise’s platform offers a limited array of outside mutual funds.
“I think the problem has been the perception that we can’t house a number of funds,” said Mr. Dave, who joined the firm in 2006 from Banc of America Investment Services Inc., which is based in Charlotte, N.C.
In 2005, Ameriprise was spun off from American Express Co. of New York. It has about 7,500 franchisee advisers who operate as independent contractors.
James M. Cracchiolo, the CEO of Ameriprise Financial Inc., admitted last year that the firm had not been “clearly focused” on recruiting reps and advisers from wirehouses (InvestmentNews, Nov. 27).
“Because of the spinoff, a lot of the initial activities got derailed and delayed,” he said back then. “We started that back up again [in 2006] as we were going through the actual establishment of the separation.”
Last year, the firm began hiring management talent from rivals, snagging James Barnash from Lincoln Financial Advisors Corp. of Fort Wayne, Ind. He is a former chairman of the Denver-based Financial Planning Association.
Hired this year as field vice presidents were: Larry Feldmesser, who left UBS Financial Services Inc. of New York and now is based in Milwaukee; Michael O’Mara, who left A.G. Edwards & Sons Inc. of St. Louis and is based in Chicago; and Ray White, who left Banc of America and now is based in Orlando, Fla.
The vice president of field talent, a new position, is Cliff Ingram, who left Banc of America to join Ameriprise.
One adviser who recently joined Ameriprise admits to some of its shortcomings but stresses that the financial planning platform is a strength.
“It’s the way Ameriprise puts together financial planning,” said Thomas Cox, a franchisee adviser based in Franklin, Mass.
The focus is: “How do you approach your clients about financial planning?” he said.
Mr. Cox left New York-based Jesup & Lamont Securities Corp. last July to join Ameriprise.
He said that Ameriprise was contending with the issue of fixed-income product inventory, but the overall platform has “changed dramatically” since he joined the firm.
And the subject of financial planning is “clearly defined,” Mr. Cox said. “It leaves nothing to chance.”