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Mindy Diamond on Independence: A Top Attorney's Perspective on Transitions, Retire-in-Place Programs and Termination

Tom Lewis, certified civil trial attorney at Stevens & Lee, discusses the landmines financial advisors need to be aware of when considering changing firms.


There’s no doubt that changing firms or models is a complex process. And even the thought of doing so often brings advisors to their knees with concerns over everything from portability to Protocol—and all that lies in between.

Yet it’s the contractual obligations advisors may have to their firms that drive the most anxiety—and rightfully so.­

Attorneys tell us they’re getting an “avalanche” of outreach from advisors wanting to make sure that their employment agreements don’t bind them further to their firm.

It’s an issue we’re seeing more and more of in recent years, as the wirehouses work harder to retain their top talent.

Take, for example, retire-in-place programs—also known as “succession” or “sunset” plans.

Almost every major firm has its own version, which allows senior advisors to retire, transfer their business to the next gen and monetize in place. These programs – such as Merrill’s CTP, UBS ALFA and Morgan Stanley’s FFAP – can be compelling for senior advisors who have every intention of retiring from their firm and being rewarded for their life’s work.

Yet many advisors are finding that there are clauses and restrictions that further tie them and their next gen to the firm—limiting any optionality for now and in the future.

Add to that an increasingly hyper-vigilant compliance environment, where advisors are feeling increasingly vulnerable and worried about possible termination.

The reality is that whether you’re considering changing firms or not, there are plenty of potential landmines that all advisors need to be aware of.

To shed some light on the key areas that advisors should be most concerned about, Tom Lewis, a Board-Certified Civil Trial Attorney at Stevens & Lee based in Princeton NJ, joins the show.

Tom specializes in employment litigation and advisor transitions—and has firsthand knowledge of the ins and outs of advisor transitions, retire-in-place programs, and termination—all hot topics in today’s evolved wealth management landscape.

In this episode, he and Mindy discuss:

  • What’s behind the uptick in advisor movement—and the impact of the pandemic coupled with the growing restrictive nature of firms is causing many top advisors to consider their options.
  • How Protocol and non-Protocol transitions differ—and while non-Protocol might take a bit more time and effort, moves have been successful, nonetheless.
  • What he sees as the real benefits of retire-in-place programs—and what both senior and next gen advisors need to be aware of before signing these restrictive and binding agreements.
  • What’s driving the recent wave of terminations for “internal acts”—and what advisors need to be aware of to make themselves less vulnerable.

As Tom shares, “advisors should always operate with their eyes wide open.” That will help keep problems at bay, and also enable you to be available to opportunities as they present themselves.

It’s an episode filled with priceless information for every advisor—whether you’re considering a move or not.

Download a transcript of this episode…

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Browse more episodes of Mindy Diamond on Independence: A Podcast for Financial Advisors Considering Change.

Mindy Diamond is CEO of Diamond Consultants in Morristown, N.J., a nationally recognized boutique search and consulting firm in the financial services industry.

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