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Raymond James: Staying in Protocol Cuts Confusion for Clients

By Rita Raagas De Ramos March 12, 2018

Raymond James Financial is sticking to the Protocol for Broker Recruiting to support both their advisors and their clients, says Tash Elwyn, president of Raymond James & Associates Private Client Group.

Raymond James & Associates is the broker-dealer subsidiary of Raymond James Financial responsible for around 2,790 employee broker-dealer advisors in more than 280 branch offices. Raymond James Financial has around 7,400 advisors in around 3,000 locations.

Elwyn, who believes the broker protocol needs to be strengthened rather than abandoned, stresses that Raymond James believes in “freedom and power of choice” for advisors and clients alike. He says it has been Raymond James’ “longstanding position” that “the client relationships belong to the advisor, not the firm.”

Raymond James recognizes that it is the financial advisor who has earned the client’s trust and built the relationship over time, and the firm believes that “advisors should be able to provide that continuity of advice and care for their clients –- no matter their firm affiliation,” says Elwyn.

“The protocol is important because it reflects the importance of the advisor-client relationship and reduces confusion and disruption with client accounts,” Elwyn says.

Elwyn adds that the broker protocol also saves on legal costs for both firms and advisors and improves efficiency for transitioning advisors moving from one firm to another.

Raymond James & Associates generated record net revenues of $4.42 billion in 2017, up 22% from 2016, partly due to “strong financial advisor retention and recruiting results,” according to the company’s records.

Tash Elwyn

Raymond James is proclaiming its loyalty to the broker protocol amid high-profile exits from the pact, led by Morgan Stanley in November and UBS in December. Both firms have resorted to filing motions for temporary restraining orders against certain former advisors since they exited the broker protocol.

At least 26 signatories withdrew from the broker protocol in 2017, and at least six withdrew in the first six weeks of 2018. There were only around 100 withdrawals from the broker protocol from 2004 to mid-2017, according to Dennis Concilla, head of Carlile, Patchen & Murphy’s securities group.

Raymond James’ stand on the broker protocol appears to be helping it attract advisors from UBS and Morgan Stanley.

Last month, ex-UBS advisor Andrew Hutcheson, who had around $200 million in client assets, moved to Alex. Brown, a division of Raymond James Financial, partly, he says, because of Raymond James’ “pledge that you own your book of business.”

“Advisors should be able to provide that continuity of advice and care for their clients – no matter their firm affiliation.”
Tash Elwyn
Raymond James

Also last month, eight former Morgan Stanley advisors, led by Patrick O’Neill, who reportedly had $337 million in client assets, set up an independent advice firm affiliated with Raymond James.

Meanwhile, Citigroup, which exited the broker protocol in January, stresses it remains committed to supporting their clients’ choice – whether to stay with the firm or go with departing advisors – even if it is no longer a signatory to the pact.

A Citigroup spokesman says acting in the clients’ interest‎ is the firm’s “top priority” and "customers are always free to move their investments as they choose.”

Morgan Stanley, UBS and Citigroup have tied their decision to exit the broker protocol to advisor retention initiatives.