Sep 11, 2007 1:45 am

Pretty soon, you won't be able to prospect at all. Trainees will have to get all their business from walk-ins, referalls and osmosis.

Unbelievable:

http://biz.yahoo.com/ap/070910/seniors_fraud.html?.v=7

AP
'Free Lunch' Seminars Can Entrap Seniors
Monday September 10, 8:08 pm ET
By Marcy Gordon, AP Business Writer

'Free Lunch' Seminars Ply Seniors With Food, Golf, but Sales-Pitch Perils Lurk, Regulators Say WASHINGTON (AP) -- "Free Food. Free Golf. Free Drinks." "Dinner is On Us!" "Act now!" Investment seminar pitches like these abound in areas with large populations of retirees, and regulators are warning seniors to be wary. A probe of the meetings has uncovered high-pressure sales pitches for unsuitable products, misleading claims and even outright fraud, federal, state and securities-industry regulators said Monday.

The Securities and Exchange Commission held a "seniors summit" on investment fraud and abusive sales practices with the North American Securities Administrators Association, which represents state securities regulators; AARP, the advocacy group for seniors; and the Financial Industry Regulatory Authority, the securities industry's self-policing organization.

While their promoters paint the "free lunch" seminars as educational sessions, sometimes promising that nothing will be sold, "they are designed to sell -- either at the seminar itself or later," said Lori Richards, director of the SEC's Office of Compliance Inspections and Examinations. "They're not educational events."

The investigation conducted by the SEC, state regulators and FINRA found the use of scare tactics to get seniors to question their current investments, claims of fantastic returns with no risk, and "ringers" in the audience who would stand up and offer testimonials of how much they had earned.

The investigation, which ran from April 2006 to June 2007, was conducted in seven states with large numbers of retirees: Alabama, Arizona, California, Florida, North Carolina, South Carolina and Texas.

Sen. Christopher Dodd, D-Conn., chairman of the Senate Banking Committee, said he planned to put forward a legislative proposal to address "the financial exploitation of America's seniors."

"I am alarmed by the unscrupulous, fraudulent and abusive practices highlighted" by the regulators' report, Dodd said in a statement issued after Monday's meeting. "Regrettably, these practices appear to be part of a growing trend of predatory behavior targeted towards America's seniors."

By law, the sales pitches made at the seminars and the materials provided to participants must be approved by a brokerage or investment firm's supervisors and submitted to review by FINRA.

But nearly 60 percent of the 110 investment firms and branch offices examined showed evidence of weak supervision of the employees running the seminars, according to the investigation's report. That is significant, Richards said, and indicates that many firms putting on the seminars need to "immediately step up" their supervision of salespeople. The firms were not named.

Jeannie Bunton, a spokeswoman for the Securities Industry and Financial Markets Association, Wall Street's biggest lobbying organization, said the group had not yet read the report and had no immediate comment on that finding. Association President and CEO Marc Lackritz did say in a statement that "flimflam artists and fly-by-nighters with their gimmicks and come-ons undermine the public's trust and have no place in the financial services industry."

Indeed, 14 of the 110 examinations showed apparent instances of fraud, such as liquidating accounts without a customer's knowledge or consent, or selling bogus investments -- and have been referred to appropriate authorities for possible enforcement action. Fraud against seniors also can occur, for example, in the sale of oil and gas partnerships or phony promissory notes.

People 60 and older make up 15 percent of the country's population but account for an estimated 30 percent of fraud victims. An estimated $16 trillion -- three-quarters of the nation's consumer financial assets -- is held by households headed by people 50 or older, and regulators expect an increase in scams targeting retired baby boomers.

In the past two years, the SEC has brought more than 40 enforcement cases involving alleged fraud against seniors, many in coordination with state authorities. In addition, FINRA, known until recently as the National Association of Securities Dealers, has filed cases against a number of brokerage firms and individual employees.

"Our research shows that almost one in five seniors who lost money on an investment attribute that loss to being misled or defrauded," said Mary Schapiro, FINRA's chairman and chief executive. "This concern is real, and confronting it will require a focused regulatory effort."

Among other things, FINRA is examining whether brokers are using so-called "professional" designations to mislead and defraud senior investors.

Sep 11, 2007 1:54 am

But there really is no free lunch, and as a senior I can tell you the game for seniors is to try to get the free lunch, and the advisor must sell to win.

Imagine dentists doing educational seminars and then trying to persuade the mark to rip out the other dentists faulty crowns.

Why not call a fig a fig, and elevate the profession to being more referral based? The way to do that is for more senior advisors to take on junior associates, and teach the business by servicing the heck out of existing clients while encouraging junior to follow the referral trail off those satisfied customers.

Sep 11, 2007 1:05 pm

[quote=fluor]

Why not call a fig a fig, and elevate the profession to being more referral based? The way to do that is for more senior advisors to take on junior associates, and teach the business by servicing the heck out of existing clients while encouraging junior to follow the referral trail off those satisfied customers.

[/quote]

I completely agree. Unfortunately, as my experience has painfully demonstrated the business, at least my firm/office is inundated with selfish, greedy senior advisors. The only thing they're interested in as it relates to a rookie is hoping they flame out after having brought in x number of assets so they can pillage.

Most senior advisors are too insecure/short sighted to recognize any value as it relates to having a junior partner. Meanwhile that concept is flourishing in law firms and accounting firms.

Sep 11, 2007 4:10 pm

[quote=Chris Hansen][quote=fluor]

Why not call a fig a fig, and elevate the profession to being more referral based? The way to do that is for more senior advisors to take on junior associates, and teach the business by servicing the heck out of existing clients while encouraging junior to follow the referral trail off those satisfied customers.

[/quote]

I completely agree. Unfortunately, as my experience has painfully demonstrated the business, at least my firm/office is inundated with selfish, greedy senior advisors. The only thing they're interested in as it relates to a rookie is hoping they flame out after having brought in x number of assets so they can pillage.

Most senior advisors are too insecure/short sighted to recognize any value as it relates to having a junior partner. Meanwhile that concept is flourishing in law firms and accounting firms.

I agree with both statements! But the reason senior advisors are that way is the wire house mentality they grew up in! (Screw everyone and everything to make quota to keep your job))If you can change the way wire houses and insurance companys treat and train employees you can make our profession more professional.

Sep 11, 2007 4:40 pm

Good points. Like Reagan said, " vote with your feet ", meaning in this case, it seems the market is forcing all to be more ethical.

The wire houses are focusing on the wealthy with sophisticated new products, with more risk and reward, and the common man is served by efficient producers like the local LPL office or Ed Jones or Ameriprise.

Sep 11, 2007 5:37 pm

[quote=fluor]

Why not call a fig a fig, and elevate the profession to being more referral based? [/quote]

Name a business, even professional services like dentists, MDs, lawyers, that doesn't advertise. Name one that's purely "referral based".

Sep 11, 2007 5:38 pm

[quote=doc c]

and the common man is served by efficient producers like the local LPL office or Ed Jones or Ameriprise.

[/quote]

ROFLMAO

Sep 11, 2007 5:41 pm

How is LPL, EdJ, or Ameriprise more efficient than a wirehouse? Wirehouse advisors have the ability to serve middle america, it's just not as profitable for us than going after bigger fish. Ameriprise can only go after people with little money because they use so much insurance in their "financial plans" and EdJ collects a lot of up front money by using A shares, thus making smaller accounts profitable. With LPL, I guess it would be up to each advisor/office as to how their business is run. Everyone has a different business model. I look at it this way, if wirehouses aren't efficient, then why are most of the assets held with them?

[quote=doc c]

Good points. Like Reagan said, " vote with your feet ", meaning in this case, it seems the market is forcing all to be more ethical.

The wire houses are focusing on the wealthy with sophisticated new products, with more risk and reward, and the common man is served by efficient producers like the local LPL office or Ed Jones or Ameriprise.

[/quote]

Sep 11, 2007 5:52 pm

Well shadow, now we have an interesting discussion, of course I am looking for the answers.

The fact that wirehouses hold most of the assets is, of course, historical, and there is a big dynamic now with assets moving to other channels.

If we're talking about the average mass affluent investor, say 300k in accounts, and the average book, say 40 million, then when you look at LPL's payout compared to what the average advisor gets at a wire house (Amerprise franchisees get a high payout, too, and Jones reps get to do their own thing with some nice corporate benefits, in the humble viewpoint of some), I'd say efficiency means more money to the advisor, and maybe less cost to the client, while allowing the firm to be profitable.

I'm not challenging the wire house model. I have a lot of respect for my colleagues everywhere.

Hey Mike, I take it you are not affiliated with one of the mentioned firms, and I have no problem with advertising - that's the kind of brand positioning that makes sense. The referrals just come easier when you are already positioned in the prospect's mind, that's a case for affiliating with a branded wire house, or even to wear your golf clothes to work at your own LPL or Ameriprise office.

Sep 11, 2007 6:05 pm

Different strokes for different folks I guess. My clients like where I am, and there are a lot of benefits to them with me being here. I like the ease of doing business, if I need something done, it gets done quickly. I came from the small business world, so I guess I just don't have the urge to open my own office and deal with those hassles again. Heck, the main reason I even sold my old business in the first place was that I got tired of dealing with employees and all the things a small business entails.

Wirehouses aren't that expensive to the client, the cost throughout just about any channel is going to be comparable simply due to competition. No, I don't get the same payout as an Indy, but I don't deal with all the stuff they deal with either so the tradeoff works for me. But between the bonuses and other incentives, the difference isn't as big as some people make it out to be. As for Jones, I'm not sure why you'd think they make more than a wirehouse advisor. Their payouts are similar to ours. And we get trips too...

For my situation, a wirehouse works. I have mass affluent clients that I service just fine from here. But being here also gave me the resources to get HNW and UHNW clients that I would have never had the shot at if I were in another channel.

[quote=doc c]

Well shadow, now we have an interesting discussion, of course I am looking for the answers.

The fact that wirehouses hold most of the assets is, of course, historical, and there is a big dynamic now with assets moving to other channels.

If we're talking about the average mass affluent investor, say 300k in accounts, and the average book, say 40 million, then when you look at LPL's payout compared to what the average advisor gets at a wire house (Amerprise franchisees get a high payout, too, and Jones reps get to do their own thing with some nice corporate benefits, in the humble viewpoint of some), I'd say efficiency means more money to the advisor, and maybe less cost to the client, while allowing the firm to be profitable.

I'm not challenging the wire house model. I have a lot of respect for my colleagues everywhere.

Hey Mike, I take it you are not affiliated with one of the mentioned firms, and I have no problem with advertising - that's the kind of brand positioning that makes sense. The referrals just come easier when you are already positioned in the prospect's mind, that's a case for affiliating with a branded wire house, or even to wear your golf clothes to work at your own LPL or Ameriprise office.

[/quote]

Sep 11, 2007 6:23 pm

Yep, I tend to agree with you about the perception of having a shot at the HNW with a wirehouse. And I don't think Jones gets paid any more, and if you anyone give you **** about getting rid of the small business and says this or that is better, they are just trying to get in a p****** contest.

Also, it is known that HNW individuals start taking on multiple advisors at about 1m plus in assets, and I can tell you, it is easy to move that amount of money no matter what your platform. Of course, have super rich clients (more than six million in my case) - I think this is associated more with the wire house, I'd probably use one myself if I had that much money.

That must feel pretty good, moving from being a small business owner to working at a wire house. I'm not very good at group politics, it would be a disaster. Another reason the indy channel exists, political, not economic.

Sep 12, 2007 12:58 am

[quote=doc c]

If we're talking about the average mass affluent investor, say 300k in accounts, and the average book, say 40 million, then when you look at LPL's payout compared to what the average advisor gets at a wire house (Amerprise franchisees get a high payout, too, and Jones reps get to do their own thing with some nice corporate benefits, in the humble viewpoint of some), I'd say efficiency means more money to the advisor, and maybe less cost to the client, while allowing the firm to be profitable. [/quote]

At thate level of prodcution, after all expenses, and unless the rep really cuts his standards (support, technology, office) I don't think you're much better off, if at all.

I'm not challenging the wire house model. I have a lot of respect for my colleagues everywhere.

[quote=doc c]Hey Mike, I take it you are not affiliated with one of the mentioned firms, and I have no problem with advertising - that's the kind of brand positioning that makes sense. The referrals just come easier when you are already positioned in the prospect's mind, that's a case for affiliating with a branded wire house, or even to wear your golf clothes to work at your own LPL or Ameriprise office.

[/quote]

If you think the guy in an Ameriprise office in a golf shirt is "positioned" like someone at a wirehouse, well, we have very different views of the world, or different markets, or both.

Sep 12, 2007 1:03 am

[quote=doc c]

I'm not very good at group politics, it would be a disaster. Another reason the indy channel exists, political, not economic.

[/quote]

You may be right about there being other reasons than financial, but as to "group politics", I just haven't seen that dynamic at a wirehouse. Frankly, I've yet to see anyone give a flying flip about anything other than doing good, clean business. Do the business, and the other stuff takes care of itself.

Sep 12, 2007 1:18 am

[quote=mikebutler222] [quote=doc c]

If we’re talking about the average mass affluent investor, say 300k in

accounts, and the average book, say 40 million, then when you look at

LPL’s payout compared to what the average advisor gets at a wire house

(Amerprise franchisees get a high payout, too, and Jones reps get to do

their own thing with some nice corporate benefits, in the humble

viewpoint of some), I’d say efficiency means more money to the advisor,

and maybe less cost to the client, while allowing the firm to be profitable.

[/quote]

At thate level of prodcution, after all expenses, and unless the rep

really cuts his standards (support, technology, office) I don’t think you’re

much better off, if at all.

I’m not challenging the wire house model. I have a lot of respect for my

colleagues everywhere.

[quote=doc c]Hey Mike, I take it you are not affiliated with one of the

mentioned firms, and I have no problem with advertising - that’s the kind

of brand positioning that makes sense. The referrals just come easier

when you are already positioned in the prospect’s mind, that’s a case for

affiliating with a branded wire house, or even to wear your golf clothes to

work at your own LPL or Ameriprise office.

[/quote]

If you think the guy in an Ameriprise office in a golf shirt is

"positioned" like someone at a wirehouse, well, we have very different

views of the world, or different markets, or both.

[/quote]

Hey Mike aren’t you the guy that switches firms every .8 years? Just

curious.

Sep 12, 2007 1:41 am

If you think the guy in an Ameriprise office in a golf shirt is "positioned" like someone at a wirehouse, well, we have very different views of the world, or different markets, or both.

LPL, Ameriprise vs. what, Merrill? At the risk of appearing ignorant, tell me what really makes the Merrill guy special. I've been around, and I'd really like to hear the specifics from you, if you don't mind.

Sep 12, 2007 3:20 am

[quote=Reggin] [quote=mikebutler222] [quote=doc c]

If we're talking about the average mass affluent investor, say 300k in
accounts, and the average book, say 40 million, then when you look at
LPL's payout compared to what the average advisor gets at a wire house
(Amerprise franchisees get a high payout, too, and Jones reps get to do
their own thing with some nice corporate benefits, in the humble
viewpoint of some), I'd say efficiency means more money to the advisor,
and maybe less cost to the client, while allowing the firm to be profitable.
[/quote]

At thate level of prodcution, after all expenses, and unless the rep
really cuts his standards (support, technology, office) I don't think you're
much better off, if at all.

I'm not challenging the wire house model. I have a lot of respect for my
colleagues everywhere.

[quote=doc c]Hey Mike, I take it you are not affiliated with one of the
mentioned firms, and I have no problem with advertising - that's the kind
of brand positioning that makes sense. The referrals just come easier
when you are already positioned in the prospect's mind, that's a case for
affiliating with a branded wire house, or even to wear your golf clothes to
work at your own LPL or Ameriprise office.

[/quote]

If you think the guy in an Ameriprise office in a golf shirt is
"positioned" like someone at a wirehouse, well, we have very different
views of the world, or different markets, or both.

[/quote]

Hey Mike aren't you the guy that switches firms every .8 years? Just
curious.[/quote]

No, I'm the guy that has moved, the last (and I do mean last) being five years ago. I assume you think that's clever or cutting, somehow, to mention that. I've been through the pros/cons and the reasons why. I wouldn’t recommend it except under very limited circumstances. I’ve had the chance to see wirehouse settings, a bank and the Indy world. Now, what that has to do with the relative stature of Ameriprise versus a wirehouse is a question left hanging.<?:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

Now that you’ve tried to make an issue of my history in the industry (spotless U-5, club membership, generous recruiting bonus), how about you tell us about yours? Got the courage?

Sep 12, 2007 3:24 am

[quote=doc c]

If you think the guy in an Ameriprise office in a golf shirt is "positioned" like someone at a wirehouse, well, we have very different views of the world, or different markets, or both.

LPL, Ameriprise vs. what, Merrill? At the risk of appearing ignorant, tell me what really makes the Merrill guy special. I've been around, and I'd really like to hear the specifics from you, if you don't mind.

[/quote]

The sharpest contrast is Ameriprise versus any wirehouse, and if you need the differences in the business model, target client and well, stature between the two explained you either

1) Haven't "been around" as you claimed

or

2) Deluding yourself

Ameriprise, just typing that makes me feel like I need a shower...

Sep 12, 2007 3:38 am

Well, I'm not going to brag, so I guess you'll just have to remain the Mystery Man. But in my life, I have discovered that perceptions can be pretty subjective. You could be ... living in Chicago in some stuffy suburb, going to your ML office, down the freeway, living your happy Chicago suburban life, and not have a clue how good it can be ( I'm sure it can be terrific in the Chicago suburbs).

Hey, point is, you made the claim, so sleep tight in your bed.

Sep 12, 2007 5:18 am

[quote=doc c]

Well, I'm not going to brag, so I guess you'll just have to remain the Mystery Man. But in my life, I have discovered that perceptions can be pretty subjective. You could be ... living in Chicago in some stuffy suburb, going to your ML office, down the freeway, living your happy Chicago suburban life, and not have a clue how good it can be ( I'm sure it can be terrific in the Chicago suburbs).

Hey, point is, you made the claim, so sleep tight in your bed.

[/quote]

Is this some attempt to threaten me?

Sep 12, 2007 5:35 am

Uh, no. Sorry if you took it that way. It’s late, been a long day. I’m saying, you made a claim, so back it up. Otherwise, you don’t know what you don’t know. Sleep tight in this case means, good night. Like, good night, fellow human. Not at all meant to be unfriendly.

Sep 12, 2007 12:52 pm

As a wirehouse guy, my opinion is that the differences between an Ameriprise franchisee (I'm not even going to compare the P1 guys) and a wirehouse broker at Merrill or otherwise aren't that huge when you're talking about the mass affluent 300k type accounts. It's when you hit the HNW crowd that there are more differences in products, service, and very importantly, perception. People with big money like the wirehouse model; they like that their money is being handled by a guy in a nice office with a nice suit on (at least my clients do). Oftentimes, my clients arrive for meetings in suits, if I ever showed up in a golf shirt, that would be an awkward situation. And if someone has enough money, we'll fly them to NY for a big dog and pony show; try getting that at Ameriprise. But the point is, they're just different business models. The wirehouses always have and always will be chasing after the big money. Ameriprise and many others have deemed the mass affluent to be a better target audience and more profitable to them. Neither way is wrong, but it's not an easy comparison.

And FWIW, we've ACAT'd over very large accounts from both LPL and RJ, so the indies definitely do work in the UHNW crowd also.

[quote=doc c]

If you think the guy in an Ameriprise office in a golf shirt is "positioned" like someone at a wirehouse, well, we have very different views of the world, or different markets, or both.

LPL, Ameriprise vs. what, Merrill? At the risk of appearing ignorant, tell me what really makes the Merrill guy special. I've been around, and I'd really like to hear the specifics from you, if you don't mind.

[/quote]

Sep 12, 2007 1:55 pm

Sure, this makes sense. Ameriprise, LPL, Ed Jones, the small RIA - these have more of a mass affluent feel. Of course, you have a recent survey where we find that Jones knows how to make the affluent give them what they want, make them feel good.

Fact is, a lot of us have a few multimillioin dollar accounts and a lot of several hundred thousand dollar clients. As for the golf shirt, try wearing a suit in Aspen, Bandon Dunes, Bend or even parts of LA.

I can assure you the wire house suit impresses few in Southern California. That's my point about perceptions. I be most Ameriprise guys in Chicago wear a suit and work out of a crowed, fancy office, but the best potential for an indy it to make a great income and enjoy a ton of freedom - this may be unimaginable for the average wirehouse suit in downtown Cleveland.

And don't count on any branded wire house as having superior skills, products and services.

Sep 12, 2007 2:19 pm

[quote=doc c]

And don't count on any branded wire house as having superior skills, products and services.

[/quote]

When compared to Jones or Ameriprise?

Sep 12, 2007 3:01 pm

Generally, I don't think in absolutes, unless talking about things like life, death, faith, God. I'm sure your wirehouse, for you, is absolutely superior than Jones, LPL, Ameriprise, so that's what's important to you, and you should be respected for what's important to you.

As for me, as an advisor affiliated with a broker dealer that is not a downtown wire house, a lot of my clients feel they are lucky to have me and feel they receive comprehensive and state of the art products and services. The fact that I make a fantastic living, work much less than full time, and never wear a suit, that's just gravy.

We have to keep ourselves motivated. We get to help our clients, and this is pretty interesting work. But I would not say that this work is either rocket science or totally entertaining. Being persistent and dedicated is very important. I don't think any platform has a monopoly on the basic human qualities and behaviours needed for success.

The more we as professionals respect each other and celebrate our similarities, the faster we grow as a real profession.

Sep 12, 2007 3:26 pm

I don't think professionalism is enhanced when members of an industry close their eyes to some pretty basic concepts, or pretend that all platforms/business models are equal. You keep wanting to drag LPL into this, which I think is inappropriate since many/most LPLs are privately branded unlike the other two. There are people here affiliated with LPL I respect. <?:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

Jones is another animal. The entire “we’re the only ethical people in the business” ethos, the banging 85% of all customers (yeah, customers) into American funds, the antique technology, the “cold walking”, strip mall locations thing leaves me cold. I’m certain there are some fine people working there, but I believe most of them are in Jones because that’s where they entered the industry and didn’t have a broad understanding when they signed up. There are several former Jonesers here I respect, and maybe even some still there.

Ameriprise, otoh, is another thing all together. Imagine Amway meets financial services….

Sep 12, 2007 3:33 pm

Yeah, as I recall, you have a dog in this fight, as you moved from being indy to wire house? I've heard folks says failed wire house brokers move to indy, and I've seen failed independents move to wire.

And a lot of failed Jones and Ameriprise guys blow out to LPL, Commonwealth, and the like.

Again, you are the fellow making a lot of claims, which is your perfect right, but I don't think you are doing a very eloquent job of articulating any new insights about how your s*** doesn't stink just because you moved to a wire house five or so years ago.

And so back to the expression, "sleep tight", meaning, what you don't know is not likely to affect my world. But if you come up with something really insightful, please let me know.

Sep 12, 2007 3:38 pm

[quote=doc c]

Yeah, as I recall, you have a dog in this fight, as you moved from being indy to wire house? I've heard folks says failed wire house brokers move to indy, and I've seen failed independents move to wire. [/quote]

Well, considering I moved from a wirehouse to indy and back again, what, by your theory, does that make me?

BTW, you want to frame this as me being anti-Indy, when I think I've been pretty clear I'm not anti-Indy at all, I'm anti-Ameriprise. You see the difference, right?

[quote=doc c]

Again, you are the fellow making a lot of claims, which is your perfect right, but I don't think you are doing a very eloquent job of articulating any new insights about how your s*** doesn't stink just because you moved to a wire house five or so years ago. [/quote]

You're making the smame error here that you made above. If you think my view of Ameriprise is out of the norm among pressionals in the industry, ask around.

Sep 12, 2007 4:37 pm

Yep, so I concede the point that you, mikebutler222, are anti-Ameriprise, for reasons known to you. Maybe you had a bad experience, I'm not prying.

If you think my view of Ameriprise is out of the norm among pressionals in the industry, ask around.

Anyone else is welcome to chime in. If we are just going on feelings or impressions, there might not be much to talk about.

I don't think professionalism is enhanced when members of an industry close their eyes to some pretty basic concepts, or pretend that all platforms/business models are equal.

Whether you see it or not, you are guilty of muddling things when you define the playing field as being based on perception.

I don't have any particular theory as to the significance of your moving from wire to indy back to wire. Except, you have a dog in the fight, and I don't think you're some kind of high rolling wealth manager that has differentiated himself from the average guy or has earned the right to condemn Jones and Ameriprise on the basis of his experience and perceptions.

You invoke the viewpoint of other professionals in the industry as if you belong to some kind of grand country club. I'm guessing you live on the East Coast, maybe you grew up in a wealth Connecticuit suburb and are living the legacy. It seems like you have a need to reinforce the fading status quo, when in fact the perception you defend is threatened - and it seems like you are taking it out on Jones and Ameriprise, or even Wadell for that matter, if Wadell serves the common man to the tune of Copland's Fanfare for the Common Man, who are you and I to complain? Or do you just have a hard-on for Ameriprise?

If you want to argue the facts, that might be useful, otherwise, I am forced to conclude that you are either threatened or annoyed in some specific and undisclosed manner about those companies, and more importantly, some of the fine advisors who choose to affiliate with those outfits.

It's ultimately more fun to create than to destroy, even in your mind.

Sep 12, 2007 4:44 pm

My view of Ameriprise is colored at the moment because I'm in a dogfight to keep a client from being ACAT'ed to AMP. The client has got some fo my best work and has blown past the indexes, but she's unfortunately too unsophisticated to see through the sales pitch. Her excuse is that he's literally across the street from her condo and I'm 60 miles away. I've seen the guy's work...terrible...and losing an account to him would be a first. Ethically, I don't see how he makes a pitch as the stuff she's in has blown his work away. This would be my first lost account (other than death) since I've gone indy, so as you can probably tell, I'm taking it personally.

AMP reps preying on unsophisticated people is the only thing I ever saw out of WillieMacca that had a grain of truth to it. It just pisses me off that I have to waste time saving an account that shouldn't even be on the table.

Sep 12, 2007 5:12 pm

[quote=doc c] <?:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

Yep, so I concede the point that you, mikebutler222, are anti-Ameriprise, for reasons known to you. Maybe you had a bad experience, I'm not prying. [/quote]

Perhaps it’s because I’ve seen enough IDS/American Express/Ameriprise accounts to recognize a business model that centers on high priced, yet useless “financial plans” followed by people being stuffed into inappropriate, expensive and proprietary insurance/annuity/mutual fund “solutions”.

[quote=doc c] I don't have any particular theory as to the significance of your moving from wire to indy back to wire. Except, you have a dog in the fight, and I don't think you're some kind of high rolling wealth manager that has differentiated himself from the average guy or has earned the right to condemn Jones and Ameriprise on the basis of his experience and perceptions. [/quote]

I really couldn’t care less about your theories, or what you think of me. Your dog in this fight is obvious, even as you attempt to hide in your anonymity. Again, you may want to trying continuously to inaccurately reframe this discussion as me being “anti-Indy”, but anyone following this objectively knows better. The issue is Ameriprise.

[quote=doc c] If you want to argue the facts, that might be useful, otherwise, I am forced to conclude that you are either threatened or annoyed in some specific and undisclosed manner about those companies, and more importantly, some of the fine advisors who choose to affiliate with those outfits. [/quote]

Yawn… remember, we’re not talking “companies” here, as you continue to try to twist the debate and my comments. The issue is one company, Ameriprise. If you really think anyone, much less a guy at a wirehouse is “threatened” by the likes of Ameriprise, or that we’re even working with the same demographic group, you’re very, very mistaken.

Sep 12, 2007 5:21 pm

Indy, it always feels crappy to lose a client. If you are around long enough, we can all feel bad about losing a client to this competitor or that one.

AMP reps preying on unsophisticated people is the only thing I ever saw out of WillieMacca that had a grain of truth to it.

I don't know about this, but I'd be careful about generalizations.

The client has got some fo my best work and has blown past the indexes, but she's unfortunately too unsophisticated to see through the sales pitch. Her excuse is that he's literally across the street from her condo and I'm 60 miles away.

This might put the discussion back on square of seeing Ameriprise as more of a competitive threat, especially with regard to the mass affluent, meaning assets under management from about $100,000 to 1m. After 1m, wealthy clients tend to seek multiple advisor relationships, so I'm not sure if everyone appreciates the sweet spot the mass affluent represents.

From my research and understanding, here are a few facts about Ameriprise with regard to branding and seeking to create what could become significant momentum in capturing mass affluent market share and assets:

The company is in the process of literally making a brand. On TV ads, Dennis Hopper has rapport with viewers, he's cool and projects a modern, innovative company.

AMP's message is: help achieve your dreams through the financial planning process. A stated fact is: more people come to Ameriprise for financial planning than any other company.

Their strategy is to become more relevant locally, with neighborhood offices that are locally owned by franchisees who maintain an owner's mentality and equity in the business, with high payouts.

AMP want to engage the mass affluent online, and the mass affluent are online. Clients coming to AMP instead of advisors chasing them.

A new TV ad campaign is planned, with Hopper saying, " Dreaming is encouraged and required. Dreams don't retire. In order to make those dreams real, they still need a plan. It's not where dreams take you, it's where you take your dreams.

Unfortunately, much of this business is about perceptions and good feeling, not beating indexes, and that's why clients hire us.

Does AMP represent an increasing competitive threat? The company seems to be doing pretty well, and they have a lot of money. AMP seems to be planning based, which is a pain in the butt in the minds of many, but they have a lot of CFPs.

In thinking about our business, it is always a game of trying to think a few moves ahead, if you want to survive, and justifying where you are to continue staying alive. I'm not saying they are going to take over, just that they have a brand, and a niche, and have apparently done a lot of research and spent a lot of money.

Unless you can be articulate, Mike, it might look like sour grapes.

I see the ads on TV for branded financial services. I think the ad with the floaty thought things putting retirment in the front of mind, that's pretty cool. UBS golf ads are cool, with the personal relationship thing, one on one. Very effective. Merrill is looking kind of tired and East Coast, maybe that's good for them.

I would thing being part of creating a brand is exciting for some, much more fun than conducting a rear guard action, Mike. You are the one who is making claims, let's hear some facts.

Sep 12, 2007 5:36 pm

[quote=doc c]

From my research and understanding, here are a few facts about Ameriprise ...... [/quote]

Does your research and understanding go beyond happy talk about Dennis Hopper being cool? Does it include anything about the IDS/Amex/Ameriprise legacy of high pressure overpriced "financial plan" followed by VUL sales?

Tell me more about Ameriprise's research team, for example.

[quote=doc c]Does AMP represent an increasing competitive threat?

[/quote]

How about you tell us? What's their AUM? Average production, average account size? Number of reps? Turnover rate?

[quote=doc c]I would thing being part of creating a brand is exciting for some, much more fun than conducting a rear guard action, Mike. You are the one who is making claims, let's hear some facts.

[/quote]

I gave you facts about what I've seen in IDS/Amex/Ameriprise accounts for years.

How about you give us some, like the questions above, or how long you've been working for them?

Sep 12, 2007 5:39 pm

If you want to disclose information about yourself, or defend anything about yourself in particular, feel free.

I'm way too seasoned to worry about the image or soul of any corporation. Too busy trying to be a good person myself, and there are plenty of temptations.

If you know of a corporation or large group of people whose s*** does not smell, please name that entity.

Shine a light.

Sep 12, 2007 5:51 pm

seniors should not be let out of the house if they are too easily fooled be a “free lunch.” seminars are a very lazy propsecting tool. work hard, service clients and reap referrals. I see these seminars in my town and laugh, annuity sales people cuase a ton of problems for us all.

Sep 12, 2007 6:07 pm

[quote=fluor]

But there really is no free lunch, and as a senior I can tell you the game for seniors is to try to get the free lunch, and the advisor must sell to win.

Imagine dentists doing educational seminars and then trying to persuade the mark to rip out the other dentists faulty crowns.

Why not call a fig a fig, and elevate the profession to being more referral based? The way to do that is for more senior advisors to take on junior associates, and teach the business by servicing the heck out of existing clients while encouraging junior to follow the referral trail off those satisfied customers.

[/quote]

Back to the original topic.

Talk about being branded! A small group of dishonest individuals do what crooks do. That is, rip people off, and now that brush is being used to paint an entire industry group.

If legislation follows it will be no different than when Levitt instituted additional regs as a result of his rogue broker study. At the time, the early/mid nineties the country's investors were being ripped off by an particularly unscrupulous type of advisor, the rogue broker. A rogue broker was one who ripped clients off but moved from from firm to firm to escape detection and punishment. It was, at the time, thought to be a serious problem. Levitt as SEC chairman devoted a large amount of energy to solve the problem. In the end, however the findings of the commission were a joke. Of the over 100,000 registered reps in business at the time less than 300 actually met the defination of rogue broker. The SEC had spent a colossal amount of time and money to uncover a non problem. They had reacted to numerous sensationalized 60 Minutes "the little old lady got ripped off" type reports, without looking at to see if the arbitration rates had suddenly spiked. Still, the result didn't stop Levitt from enacting more regs.

This article mentioned here is the same thing. A small group of crooks and a politician looking for face time on the tube.

If entire businesses could be built off the referral stream of satisfied clients that's exactly what we'd all be doing. Unfortunately, many, if not most, very satisfied clients are not inclined to give referrals. That means that many of us have to find a proactive way to bring in business if we are to grow our businesses beyond the referral pipeline.

What makes me cringe is the wrong headed connection some make to link proactive business building to dishonest businessman. Or, to paint it as unprofessional.

To those who believe that referral based business building is a more professional approach, I point to the local life insurance agent. You know, the guy who know nothing, and does nothing, but calls you asking for names of all your friends, neighbors,and relatives. Yeah, that works.

Sep 12, 2007 6:45 pm

As always, Bond guy the voice of reason and coming in with valuable historical perspective.

A rogue broker, a politician, an isolated lunch rip-off.

What makes me cringe is the wrong headed connection some make to link proactive business building to dishonest businessman. Or, to paint it as unprofessional.

On so many levels, a complete understanding of our business forces us to not pass negative judgement upon proactive business building, or for that matter to pass wholesale negative judgement on our colleagues because of their platform or brand affiliation.

It is the passing of generalized judgement that make us look unprofessional. On a subtle level, this means selling by dissing the portfolio work of your colleagues just because you want to move the AUM.

Fact: the average American needs to be persuaded to take positive action on their personal finances.

Just like selling, you sell concepts, and then you go to specifics.

For us as professionals, the big concepts are things like: politicians trying to take our lunch, how do we engage more Americans to come to us and use our services, how do we regulate ourselves, instead of counting on corporations to do the job.

Why languish in the fetid swamp, when you can climb the mountain and enjoy the view and feel the breeze?

Sep 12, 2007 7:58 pm

[quote=BondGuy][quote=fluor]

[/quote]

Back to the original topic.

Talk about being branded! A small group of dishonest individuals do what crooks do. That is, rip people off, and now that brush is being used to paint an entire industry group.

If legislation follows it will be no different than when Levitt instituted additional regs as a result of his rogue broker study. At the time, the early/mid nineties the country's investors were being ripped off by an particularly unscrupulous type of advisor, the rogue broker. A rogue broker was one who ripped clients off but moved from from firm to firm to escape detection and punishment. It was, at the time, thought to be a serious problem. Levitt as SEC chairman devoted a large amount of energy to solve the problem. In the end, however the findings of the commission were a joke. Of the over 100,000 registered reps in business at the time less than 300 actually met the defination of rogue broker. The SEC had spent a colossal amount of time and money to uncover a non problem. They had reacted to numerous sensationalized 60 Minutes "the little old lady got ripped off" type reports, without looking at to see if the arbitration rates had suddenly spiked. Still, the result didn't stop Levitt from enacting more regs.

This article mentioned here is the same thing. A small group of crooks and a politician looking for face time on the tube.

If entire businesses could be built off the referral stream of satisfied clients that's exactly what we'd all be doing. Unfortunately, many, if not most, very satisfied clients are not inclined to give referrals. That means that many of us have to find a proactive way to bring in business if we are to grow our businesses beyond the referral pipeline.

What makes me cringe is the wrong headed connection some make to link proactive business building to dishonest businessman. Or, to paint it as unprofessional.

To those who believe that referral based business building is a more professional approach, I point to the local life insurance agent. You know, the guy who know nothing, and does nothing, but calls you asking for names of all your friends, neighbors,and relatives. Yeah, that works.

[/quote]

I have to agree. The article makes ALL seminars seem like shady sales tactics. Are they sales tactics? Yes, of course. Are they all shady? Of course not. If you are not aware that you are going to some type of sales presentation, you (as BG put it so eloquently) should not be let out of the house. Now, yes, there are some shady individuals out there spreading half-truths and lies to their targets, but by and large, most of us cold-call and do seminars to get in front of people and tell them what we can offer them.

I think this is a war being waged by insiders at Fidelity and Vanguard!

Sep 12, 2007 9:07 pm

This is why I quit doing seminar lunches and started having client appreciation events…I feed 'em AFTER I get the business…

Sep 12, 2007 9:40 pm

I feed 'em AFTER I get the business

Always a wise investment policy. You can count the chickens hatching from clients' guests.

Sep 13, 2007 10:04 pm

I'm curious about the claim that AMP has the most clients come to them for financial planning. How is that calculated? I saw on the fine print in the commercial that it's disclosed in the filings somewhere, but I don't have time to look.

Is the claim simply based on the fact that at AMP, you have to pay for a financial plan before you can do anything? I have a few clients who were with AMP or had at least talked to an advisor there. They all mentioned that they had to pay for a $500 or $1500 plan up if they decided to go with AMP. If that's how it's determined, then officially I have no clients who I do financial planning for. Of course, I am doing it, but since I don't charge for it, it wouldn't show up on the books. With us, the financial plan is simply a part of the proposal to a prospect. it's understood that it's a part of what we do, we don't have to charge for it.

Do you really think that the AMP ads with Dennis Hopper actually drive business? They're decent ads and catchy, but you feel that they bring people in the door? I can see how they would increase brand recognition, but I don't know if it would translate into sales. My firm does a ton of advertising, and I don't think it's caused anyone to call us up. All I notice is that when I talk with prospects, the brand recognition is there. It gives us some small talk opportunities, nothing more.