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Letters, March 2003

Registered Rep. Letters to the Editor

Wholesale Disagreement

How sad! If the Confessions article (August 2002 by Aldo Blackthorn) accurately reflects his experience as a separate account wholesaler, the company deployed Mr. Blackthorn into the investment management “battlefield” with ancient business development weaponry. Today's marketplace demands 21st century business development skills and equipment.

The backslapping/handshaking wholesaling described in the article has been dead for more than a decade. The successful, highly compensated wholesaler of today is a smart, informed sales executive who contributes substantive investment “savvy”, consultative practice management and marketing “moxie” to the brokers, advisers and planners who partner with him or her.

Are there many 21st century wholesalers? As in most other arenas, I can count the greats on one hand. But I can also say that from our perspective at the Academy of Financial Services Studies, there are far more Luddites than visionaries among today's wholesaler and sales manager ranks. Most are watching their market shares decline and wishing for a return to the way things used to be.

Wholesaling, when practiced with integrity, skill, rigor and stamina, is a noble profession which provides top notch sales executives the opportunity to play at the top of their game, while contributing in a significant way to helping investors achieve financial independence. Who wouldn't be able to hold his head high with a career that provides this kind of gratification? (It pays well to boot.)
Rochelle Lamm,
chairman and CEO
The Academy of Financial Services
Studies, LLC
Milwaukee, Wisc.

Will the Real FAs Please Stand Up?

I wish the real financial advisors of the world would band together to fight the biggest liar of them all, Charles Schwab. Schwab claims to have unbiased research, but the company fails to note that it does not produce any research itself.

Further, it says its order takers dispense objective advice and do not “push” investments. But there's a flip side to that: Schwab employees never call clients to give any advice. When do you think a Schwab rep last called a client to proactively discuss a bond-swap?

My point is that it's easy to give “only objective advice” when the advice you are giving is of the bare-bones variety.

As you noted in a December 3 Web article, Charles Schwab is being accused of a conflict of interest of its own in a lawsuit filed by Milberg, Weiss. As the article noted, “Schwab was an underwriter at the very time that it represented to the public that it did not engage in underwriting.”

I'm sick of my profession being disgraced by Schwab. It's time financial advisors stood up and put together an ad campaign to counter his marketing. These ads should focus on the benefits of having a “real” financial advisor — one who dispenses real advice.
Major wirehouse
New York, N.Y

Optimistic Objector

I can't believe the positive spin put on Prudential Securities' report card grade in the December 2002 article “Prudential: Fissures in the Rock.”

Even though Pru scored an eight in the “Freedom from pressure to sell certain products” category, that was the lowest score among all firms ranked in that category.

Further, Pru only scored above the bottom grade in six of 20 categories — and even then it usually was in second-to-last place. The company's overall score of 6.86 was by far the lowest among the eight firms surveyed, and it was only one of two firms to register below average scores in every one of the twenty categories.
Identity withheld by request.

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