Account Distribution Policies

Feb 21, 2006 10:03 pm

I work at a major wirehouse and we have a written "account distribution policy".  I think the policy itself is unfair (accounts get distributed to the largest brokers no matter the # of years in the biz - so bottom line, the newer people never get anything, the rich just keep getting richer and the gap widens between the haves and have nots or the "given tos" and the "not given tos").

I know for a fact, though, that this policy is seldom followed.  In at least 5 separate instances, I have seen whole books of business go to someone for one reason or another.  These "favorites" suprisingly are never women, and yes, I am a woman.

Given the many class action suits that have come about alledging discrimination regarding this type of behavior, it surprises me somewhat that it still exists.

Since I can't "prove" things because I don't know what others gross exactly, and it is all very clandestine, I keep my mouth shut fearing retaliation if I say anything. 

Is this the best course of action - accept that this is still very much an "old boy network" and things in this kind of environment will never change, or bring it to my manager's attention and question it, so he knows I'm not stupid and see what's going on?

Feb 21, 2006 11:25 pm

I suggest you resign tomorrow. Not because of the office policy (which is very, very common), but because the chip(s) on your shoulder makes it clear you’re not going to succeed in this business.

Feb 22, 2006 1:15 am

Newrook,

My advice is to stop spending your time and energy with this issue, and instead focus on building your business. The re-distributed accounts that you may get are a bonus.

I have received accounts from departed/fired FA's and they are a pain in the A$$.

Worry about things you can control (like dials, meetings, networking, etc) and forget about the office/firm politics.

Feb 22, 2006 1:26 am

The concept "old boy network" may not have anything at all to do with it. Your manager may simply be distributing accounts to those who can better maximize the fee/commission income from those accounts.

If you're a rookie, your inexperience may be the only roadblock to getting these accounts, until some point in the future when you're deemed more "seasoned".

Finally, if the "old boy network" is the reason for how accounts are distributed, forget about it. The bulk of your AUM should be new accounts anyway, and not someone else's leftovers. The best way to prove your worth is to bring in new accounts.

For what it's worth, when I was with Dean Witter years ago, it was 18 months before I was given any accounts. And even then, they were cr*ppy accounts.

Good luck!

Feb 22, 2006 3:33 am

I've inherited a lot of accounts over the past 5 years and here's what I have come up with.

#1.)  The big accounts almost always leave unless they are upset about something.  To even have a shot, you have to have extensive knowledge and expirience that a rookie probably doesn't have (no offense).  The manager wants to give the firm the best chance to retain assets and reward those who have paid their dues.

#2.)  At some level (usually 250k or less) the accounts stop being given to the bigger producers and get spread among the rest.  These accounts are a goldmine because they typically are investors who got neglected by the previous broker and you can retain a lot of those.  (by the way, they almost always have more money).

#3.)  If you rely on inherited accounts to jumpstart your business, you are probably screwed anyway.

Feb 22, 2006 11:22 pm

First of all, of course I don't rely on reassigns to grow my business - I would be OUT of business.

Secondly, I don't agree with the Account Distribution policy - but it is what it is.  I think a more "fair" policy would be to distribute by gross based on LOS.  Why should a bunch of hacks who are doing OK gross because they've been in the biz 15, 20, 30 years get accounts, when on a relative basis some of the "newer" people are doing way better?  Who said life is fair, though.

What I don't find fair, and what my question asked is when ONE person getting a whole book of business.  This is not some top producer, this is someone for one reason or another is in the manager's favor.  I've seen people in the biz fewer years than I with way less gross be handed not one, but 2 books because they were a friend of the manager's old boss. 

From what I'm hearing it's "put up and shut up" - it's the way the big firms work.  Certain people get helped and that's life, and just shut my door and do my own thing and continue to grow my own biz the way I have been.  Correct?

Feb 23, 2006 12:34 am

"From what I'm hearing it's "put up and shut up" - it's the way the big firms work.  Certain people get helped and that's life, and just shut my door and do my own thing and continue to grow my own biz the way I have been.  Correct?"

Yes.... Things may not be completely equitable and fair, but it is what it is....

Feb 23, 2006 1:44 am

[quote=newrookie]

First of all, of course I don't rely on reassigns to grow my business - I would be OUT of business.

Secondly, I don't agree with the Account Distribution policy - but it is what it is.  I think a more "fair" policy would be to distribute by gross based on LOS.  Why should a bunch of hacks who are doing OK gross because they've been in the biz 15, 20, 30 years get accounts, when on a relative basis some of the "newer" people are doing way better?  Who said life is fair, though.

What I don't find fair, and what my question asked is when ONE person getting a whole book of business.  This is not some top producer, this is someone for one reason or another is in the manager's favor.  I've seen people in the biz fewer years than I with way less gross be handed not one, but 2 books because they were a friend of the manager's old boss. 

From what I'm hearing it's "put up and shut up" - it's the way the big firms work.  Certain people get helped and that's life, and just shut my door and do my own thing and continue to grow my own biz the way I have been.  Correct?

[/quote]

Correct. They aren't being "helped." They are being rewarded. Go do enough production to deserve a reward. You present yourself as a whiny woman on this board. Do you do that at the office, too? Something to look at, honey.

Feb 23, 2006 4:48 am

No, those being "rewarded" are doing less production than I am but are "personal" friends of the manager (i.e., play sports with him, babysit his kids, etc.)  or are doing more production but doing less relative to my LOS, (WAY less).

If that is being "whiny" no matter my gender, so be it.  The facts are what they are, and that is the reason there are the lawuits there are pending against wirehouses.

Given that the wormen who go after what they "deserve" are  considered "whiny" and the men that go after the same exact thing are considered "entitled". amazes me.

Feb 23, 2006 6:08 am

[quote=newrookie]

Given that the wormen who go after what they "deserve" are  considered "whiny" and the men that go after the same exact thing are considered "entitled". amazes me.

[/quote]

Nah, you whined that you weren't being handed accounts and part of your whine was because you're a woman. If a man had the same  complaint (minus the "it's 'cause I'm a woman") we'd call HIM a whiner too.

Feb 23, 2006 12:48 pm

[quote=newrookie]

Given that the wormen who go after what they "deserve" are  considered "whiny" and the men that go after the same exact thing are considered "entitled". amazes me.

[/quote]

What, in particular, makes you feel that you "deserve" or are "entitled" to anything other than that which all rookies have?

Feb 23, 2006 10:19 pm

Is this the best course of action - accept that this is still very much an "old boy network" and things in this kind of environment will never change

Yes.  Ignore it and do the best you can for yourself.  It will never change.  Eventually you will have enough AUM and experience to be able to stick your head up out of the foxhole or better yet, tell them where to stick it and take your customers with you.

You are right. If you are assertive as a woman, you are a bitch. If you are assertive as a man, you are appropriately agressive.  Who cares what they think of you as long as you get the job done.  So what if you don't get to golf with the big boys or drink scotch and smoke cigars.   Do you really want to hang out with those a-holes anyway?  

Remember      "Success is the best revenge"

Feb 26, 2006 8:43 pm

[quote=babbling looney]

You are right. If you are assertive as a woman, you are a bitch. If you are assertive as a man, you are appropriately agressive.  Who cares what they think of you as long as you get the job done.  So what if you don't get to golf with the big boys or drink scotch and smoke cigars.   Do you really want to hang out with those a-holes anyway?  

Remember      "Success is the best revenge"

[/quote]

I disagree I have seen some women who are damn aggressive and impressive I would love to have them as part of my team, and there are others who have the feeling they are being discrimated against and that is what's holding them back, they come off as "bitchy" and get zero repsect, so deserved.  I have also seen men who act aggressive, but do not know how to channel it and come off as morons, no different.

Maybe your manager thinks your "bitchy" and you don't relate well to others so giving you accounts with whom you have no previous relationship would be suicide for his #'s.  If you want respect, earn it.  Just like any other job, who gets the promotion, the better territory, who makes more, who gets the corner office.  I have never seen anything in life that's fair.

Mar 7, 2006 4:00 am

[quote=blarmston]

Newrook,

My advice is to stop spending your time and energy with this issue, and instead focus on building your business. The re-distributed accounts that you may get are a bonus.

I have received accounts from departed/fired FA's and they are a pain in the A$$.

Worry about things you can control (like dials, meetings, networking, etc) and forget about the office/firm politics.

It's pretty common that people like Butler and Blarm who have benefited from account distributions think that the system is fair.  If these new accounts are such a "pain in the A$$", then give them back, and get on with your "dials, meetings, networking, etc."  The bottom line is that accounts and assets are used as tools for managers to help those that he/she wants to help, and to send a message to those that they don't want to help.  Sure it isn't fair, and it will never be completely fair, but it sure as hell could be a lot more equitable.

[/quote]
Mar 7, 2006 4:06 pm

"It's pretty common that people like Butler and Blarm who have benefited from account distributions think that the system is fair.  If these new accounts are such a "pain in the A$$", then give them back, and get on with your "dials, meetings, networking, etc."  The bottom line is that accounts and assets are used as tools for managers to help those that he/she wants to help, and to send a message to those that they don't want to help.  Sure it isn't fair, and it will never be completely fair, but it sure as hell could be a lot more equitable."

Sooth,

You take alot of liberty in deducing that those comments suggest I have benefitted from account handouts. Sure, I was excited when the first large FA left our branch. I received a couple accounts, but the departing FA had done a good job of 'prepping' his clients for the move- so they all went with them. Since then, about 4 FA's have left and I have received a whopping 400K in accounts. So for you to assume I have benefitted from hand outs truly suggests you have preconceived notions or that you are an a$$.

And would you think my advice to focus on factors you can at least control is the wrong way? Lets go Sooth- I feel like making you look silly today......

Mar 7, 2006 6:33 pm

Said "soothysayer"...

"It's pretty common that people like Butler and Blarm who have benefited from account distributions think that the system is fair. 

Said Blarm

You take alot of liberty in deducing that those comments suggest I have benefitted from account handouts.

You're being too polite with Soothayer, Blarm, he's not taking liberty, he's talking out his, uh, hat 

Sure, I was excited when the first large FA left our branch. I received a couple accounts, but the departing FA had done a good job of 'prepping' his clients for the move- so they all went with them. Since then, about 4 FA's have left and I have received a whopping 400K in accounts. So for you to assume I have benefitted from hand outs truly suggests you have preconceived notions or that you are an a$$.

And would you think my advice to focus on factors you can at least control is the wrong way? Lets go Sooth- I feel like making you look silly today......

[/quote]
Mar 7, 2006 6:49 pm

If you've had 400K of accounts distributed to you in your career, then that is exactly 400K more than I've ever had.  Early in my career, I was passed over for distributions because I didn't have the racey production numbers of some of my peer group.  I focused on serious investors rather than greedy speculators, and built a solid, bear market proof practice based on mutual respect.  When the sh*t hit the fan beginning in 2000, and some of these pretenders started dropping like flies, their accounts were distributed to others of their ilk who all of sudden found themselves "struggling."  Once again I was passed over because "your business is flourishing and frankly you don't need the help."  When the pretenders who inherited accounts, and then inherited more accounts still ate sh*t and dropped out of the business (we're into late '02 and '03 now) I was passed over yet again.  Why?  Because "the poor clients have been through a couple of inexperienced brokers, and now they really are asking for a little older, more experienced hand."  The read between the lines:  My own production is sucking ass at the moment, my own clients are leaving in droves, and I'll take whatever I can get. 

So, I've heard all of the excuses for why I've never had an account distributed to me.  The bottom line is because I realize than I am an independent thinker who usually marches to the beat of my own drum.  I'm certainly no asskisser, and I stand up for myself and my clients in my investment philosophy and treating them the way I would want to be treated if I were on the other side of the table.  A manager would probably label me "not a team player".  Reading between the lines again: He's smart, he's sharp, his clients love him, and I view him as a threat.  Don't give that guy a damn thing! 

I've accepted things as they are, but also understand that account distribution policies (if one even exists) at most firms leave a whole bunch to be desired.  Okay, now make me look stupid......

Mar 7, 2006 7:09 pm

Sooth,

Thats great and all, but I really dont give a $hit about your history and your issues with handout policies.

I will simply call you out when you suggest I think those policies are fair and that I have greatly benefitted. You suggested both and I simply wanted to clarify that. All I posted was that there are some things you can control in your practice, such as prospecting, networking, client reviews, etc, etc. Other aspects of this business, like shady or unfair firm redistribution policies, are simply out of our control. It is what it is.

I have carefully chosen my words because I respect the vast majority of your posts..... However, when I believe someone is trying to make assumptions that are inaccurate and meant to knock me down, thats when things change. Now lets leave it alone and get to work...

Mar 7, 2006 7:10 pm

[quote=Soothsayer]

Okay, now make me look stupid......

[/quote]

The only thing, imho, that made you "look stupid" is the assumptions you made of  others.

As far as the rest of your story, being a free thinker, march to your own drum, etc.; since I don't know you I'll assume you're accurate in your assement of yourself and that you're  not a dangerous odd-ball that seeks that defintion as cover. 

Mar 8, 2006 1:05 am

Truce accepted fellow posters.  And, damn good ones at that I might add.

Apr 5, 2006 9:20 pm

Why dont you try getting some balls and talking to your manager.  You dont have to be mad and confrontational, but simply express that you have an interest in working with some of these account distributions.  If he says no, ask him to clarify when you will have that opportunity.  If he still resists, ask him if there is a reason that Mr. Smith(his workout buddy) seems to get them, and if it takes you doing things like him or helping/working with him to get you a better chance of being able to service those potential clients in the future.  Nobody is going to take offense to you wanting more work and to make money, it just depends on your attitude when you do it.  And dont wine like a woman when you are in there, be firm.

Chances are if this is his booty buddy that it will be a waste of time, but at least you went in and said something about it rather than complaining to a message board full of people who will never sympathize. 

Apr 5, 2006 9:22 pm

wine=whine

Apr 5, 2006 10:14 pm

Baylor,

Is that what you did to earn all those inherited accumulator and incentive plus accounts????

Apr 6, 2006 2:22 pm

we do now have a program to distribute these orphan clients to our advisors.  seems to be going on a non-discriminatory basis so far.  I only got together with 4 orphans last year.  I prequalified them before they came in (i contacted maybe 25), and pushed about 18k worth of production in my pocket.  So it was worth the time, but you would hate to rely on it or wish for that to be the focus of your practice. 

I wont touch the orphans that are all locked up in the AXA products, unless its a old life policy that needs a replacement w/1035.  But Blarmston, most are worthless and just a pain in your ace. 

btw, i left the evil empire about 2 weeks ago to go independent with NFP.  Seems to be a great choice thusfar, and my clients like the platform much better.  I am one of the only ones I know that has left on good terms.  It wasnt a ' F AXA, they screwed me out of success', simply NFP uses Pershing as the clearing house so transfers are a piece of cake, pay is double, much less overhead(i know that sounds crazy since im indie, but i would have to explain further), and the options i can offer clients has expanded tremendously on the investment side of business. 

Apr 6, 2006 3:26 pm

Baylor,

Good luck with your new endeavors.....

Apr 6, 2006 6:41 pm

In my experience most inherited accounts are a complete waste of time…very few diamonds in the pile.  Most are accounts that departing advisors did not want.

Apr 6, 2006 6:47 pm

[quote=Soothsayer]

If you’ve had 400K of accounts distributed to you in your career, then that is exactly 400K more than I’ve ever had.  Early in my career, I was passed over for distributions because I didn’t have the racey production numbers of some of my peer group.  I focused on serious investors rather than greedy speculators, and built a solid, bear market proof practice based on mutual respect.  When the sht hit the fan beginning in 2000, and some of these pretenders started dropping like flies, their accounts were distributed to others of their ilk who all of sudden found themselves “struggling.”  Once again I was passed over because “your business is flourishing and frankly you don’t need the help.”  When the pretenders who inherited accounts, and then inherited more accounts still ate sht and dropped out of the business (we’re into late '02 and '03 now) I was passed over yet again.  Why?  Because “the poor clients have been through a couple of inexperienced brokers, and now they really are asking for a little older, more experienced hand.”  The read between the lines:  My own production is sucking ass at the moment, my own clients are leaving in droves, and I’ll take whatever I can get. 

So, I've heard all of the excuses for why I've never had an account distributed to me.  The bottom line is because I realize than I am an independent thinker who usually marches to the beat of my own drum.  I'm certainly no asskisser, and I stand up for myself and my clients in my investment philosophy and treating them the way I would want to be treated if I were on the other side of the table.  A manager would probably label me "not a team player".  Reading between the lines again: He's smart, he's sharp, his clients love him, and I view him as a threat.  Don't give that guy a damn thing! 

I've accepted things as they are, but also understand that account distribution policies (if one even exists) at most firms leave a whole bunch to be desired.  Okay, now make me look stupid......

[/quote]

Sooth-

Reading your tale reings a lot of bells with me because my experience was quite similar.....while I received some inherited accounts now and then it was far less than some.  I didn't toe the line well enough, and did what I thought was best for clients regardless of the office 'projects'.  As I said above, my experience was that most inherited clients were 'damaged goods' at best.
Apr 7, 2006 3:58 am

I got a distribution of a client with $400K in A share mutual
funds.  The guy turned out to be on the board of a large
foundation, we got an RFP (which normally is just an invitation to kill
a bunch of trees so they can feel good about getting a few opinions
prios to going with the existing manager), a request a template for a
new Investment Policy Statement, and we ended up picking up a couple
million bucks.   This spured on a few other deals blah blah
blah. 



ANY OPPORTUNITY GIVEN TO ME, DIRECTED TOWARDS ME, AND WITHIN A SNIFF OF
ME, OUR TEAM WILL JUMP ON.  ACCOUNT DISTRIBUTIONS ARE JUST ONE
MORE OF THOSE OPPORTUNITIES.  POLICY?  DO WHAT YOU HAVE TO DO
TO MOVE UP IN THE RANKING. 

Apr 7, 2006 10:01 pm

Good advice rightway.

Assertive women get the "bitchy" label when people don't like them.  That's a fact.  Assertive men who aren't liked are called "jerks". 

So you need to figure out how to be assertive while still being likeable.  Shouldn't be hard, you're in sales.  Sell your boss on liking you enough to shepherd accounts in your direction, whether you give him a nice card, or offer to keep his kids for an evening, or give him a nice bottle of wine.  You gotta give to get.

Ace