Ameriprise Engages in Aggressive Recruiting Strategy
Ameriprise Financial, a regional independent brokerage firm, has raised its minimum signing bonus for its top recruitsfrom $1 million to nearly $1.25 million as it competes in the same recruiting arena as UBS, Morgan Stanley, Bank of America’s Merrill Lynch and Wells Fargo. Ameriprise also has raised its signing bonuses to 150 percent of T-12, from 120 percent, for those that bring on $830,000 or more. Moreover, the firm also has mailed recruitment letters directly to advisors at other firms, hinting that if they move quickly they could skip a rule requiring them to disclose their signing bonuses to their clients.
The reason that Ameriprise takes such an aggressive recruitment strategy is that it has lagged competitors in recruiting high-end brokers. During last 12 months, Amerprise recruited only eight brokers who had more than $100 million in assets under management. During the same period, regional independent firm Raymond James hired 32 new brokers with at least $3.2 billion in assets under management.
Ameriprise (as with LPL and Raymond James) has franchise-like arrangements with brokers who remain independently employed. This arrangement is different from the wirehouse firms, which employ brokers as employees.
Ameriprise (and other firms adopting a franchise model) faces a challenge: few, if any, high-end wealth management advisory firms are sufficiently “cookie cutter” to be able to market for and promote unified services and advice. That raises the issue of whether the firm even can secure a suitable candidate for a franchise. Financial services, after all, are not Subway.
We advise Ameriprise reps and other reps who suffer from that kind of “square peg, round hole” problem. The problem often is exacerbated when Ameriprise reps unknowingly execute an overreaching and restrictive franchise agreement.
The attorneys of Eccleston Law Offices represent investors and advisers nationwide in securities and employment matters. Our attorneys draw on a combined experience of nearly 50 years in delivering the highest quality legal services.
Related Attorneys: James J. Eccleston