Welcome to Financial Advisor IQ
Follow

Morgan Stanley Targets Rich Celebrity Clients

By Thomas Coyle November 20, 2014

Morgan Stanley’s wealth-management division has launched a new effort around “the unique needs of veteran and emerging talent and their advisors in the sports and entertainment industries,” the company says in a press release.

“High-net-worth earners in the sports and entertainment industries have sophisticated wealth-management requirements,” Morgan Stanley Wealth Management chief Gregory Fleming says in the release. “Our services are provided by a group of experienced financial advisors, backed by specialized training and the full resources of a leading, global investment bank, which we believe will set a new standard in the industry.”

In an e-mailed response to FA-IQ’s questions about the new program, Morgan Stanley says its new Global Sports & Entertainment, or GSE, “division” was formed to provide “clear branded identity” for work it has long done with celebrity clients. “It became clear to us that there is a real opportunity here to establish Morgan Stanley Wealth Management, through our financial advisors, as the premier financial-services provider for successful athletes, entertainers and entrepreneurs in these industries,” a spokeswoman writes.

Frank Campanale, head of Lebenthal Wealth Advisors in New York, says Morgan Stanley is right to say there’s nothing new in its effort to serve the rich and famous. “Name any firm — Merrill Lynch, UBS, Raymond James, JPMorgan — and you can be certain it’s got an entity that caters to celebrities,” says the former wirehouse executive. “We do as well, and we’re comparatively small.”

For Campanale, Morgan Stanley’s move to publicize its celebrity business is mainly a big brokerage’s attempt to retain market share in the face of ultra-rich clients’ post-2008 preference for “custody-agnostic” firms like RIAs and trust companies. But he recognizes the potential marketing value — to prospective clients and advisors alike — of trying to make the Morgan Stanley name synonymous with financial service to the stars. And he applauds the firm’s moves to back with training what might otherwise be an empty PR gambit.

That training amounts to a three-day program for advisors who already “have significant business with sports and entertainment figures,” says the spokeswoman’s e-mail.

Among other aspects of celebrity-wealth management, Morgan Stanley tells this publication its GSE training explores issues around “sudden wealth, unpredictable career spans and sources of income from contracts to endorsements, royalties” and personal appearances. The course also deals with tax issues and “requests for loans, business ventures and support of family, friends and entourages.”

GSE has a public education component as well. Morgan Stanley is “developing a financial education curriculum to be taught in sports, film and music departments across the nation with pilots beginning in early 2015,” says the press release.

This coursework is meant “to change behavior” among those with the potential to become celebrities — “and that starts with being informed and educated,” according to the spokeswoman. In substance, this still-in-the-works material will be “a mix of in-person, digital and film content” presented in the classroom by GSE-qualified advisors who have been “specially trained to deliver the curriculum.”