Ameriprise Engages in Aggressive Recruiting Strategy

Posted on June 23rd, 2014 at 9:00 AM

From the Desk of Jim Eccleston at Eccleston Law Offices:

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

Tags:

Return to Archive

TESTIMONIALS

Previous
Next

You were most helpful with my FINRA deposition. You are a good lawyer and a good person.

Dan B.

LATEST NEWS AND ARTICLES

February 14, 2025
Jefferies Financial Group Dismisses Miami Advisory Team Amid Alleged Misconduct

Jefferies Financial Group recently terminated a team of Miami-based wealth advisors following allegations of improper money transfers and the use of unauthorized communication methods to conceal the activity.

February 13, 2025
FINRA Panel Denies J.P. Morgan's $39.7 Million Claim Against Former Advisor

A FINRA arbitration panel recently rejected J.P. Morgan Securities’ bid to recover $39.7 million in damages from Edward Turley, a former financial advisor whose alleged
misconduct led the firm to incur significant settlement costs.

February 12, 2025
Edward Jones Advisor Barred by FINRA Over Allegations of Unauthorized Account Changes

FINRA has barred Gwendolyn J. Hayes, a former Edward Jones advisor in Oregon after allegations surfaced that she altered client account information without authorization.