Deals & People June 20, 2023

Advisory M&A

Four advisers join Capitol Financial Solutions; Advisor Group acquires Encore Financial Group; Hightower makes two strategic investments; and more.

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Former Securian Financial Services Advisers Join Capitol Financial Solutions

Advisor Group announced that John Amendola, Eric Owen, Michael Pugh and Steve Tanner have joined Capitol Financial Solutions, one of the largest groups affiliated with Royal Alliance.

The four former Securian Financial Services advisers from Virginia and North Carolina bring $410 million in client assets to the Advisor Group network.

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“Our decision to partner with Capitol Financial Solutions was driven by our focus on providing the best possible service experience for our clients,” said Tanner in a statement. “Capitol Financial Solutions has access to industry-leading software, powerful in-house marketing and practice management support, and a strong, compatible culture.”

Also Encore Financial Group Joins Advisor Group

Advisor Group announced the affiliation of Encore Financial Group of Cheboygan, Michigan, through Savage and Associates, one of Advisor Group’s largest groups.

Founded in 2004 by CEO Dennis Hesselink, Encore has 14 financial advisers located in offices in Florida, Michigan, Pennsylvania and Tennessee. The firm brings more than $340 million in client assets to the Advisor Group network.

“We are excited about what the future holds and the impact we can have on our community with the support, technology and expertise of both Savage and Advisor Group,” said Hesselink in a statement.

Hightower Makes Strategic Investment in Presidio Wealth Partners, Meyer Capital Group

Hightower announced it has partnered with and made a strategic investment in Presidio Wealth Partners, a newly formed Houston -based wealth management firm that oversees approximately $1.6 billion in AUM.

The firm is led by founding partners Cy Cattan, Scott Bishop, Robert Harris and Sarahbeth Pipkin, who left Avidian Wealth Partners to start the new company. According to a statement, the Presidio team was attracted to the opportunity to expand the private market investments offering for clients through support from Hightower’s experienced investment solutions team.

Additionally, Hightower announced it has made a strategic investment in Meyer Capital Group, a $1.6 billion firm with offices in Marlton, New Jersey, and Naples, Florida. With 17 employees, including 10 advisers, Meyer Capital Group serves more than 800 clients.

“Hightower is the right fit for us,” said CEO Tom Meyer in a statement. “Having access to their value-added services, operational resources and large community of other like-minded firms will serve as a catalyst for our accelerated growth.”

Ronin Wealth Management Joins Cetera Advisors

Cetera Financial Group announced that the advisers of Ronin Wealth Management have joined Cetera Advisors. Marshall Thomas and Travis Venable were previously affiliated with LPL Financial and oversee approximately $75 million in assets for high-net-worth clients, as of May 31.

“We are encouraged by Cetera’s customizable platform and feel Ronin will thrive at a more boutique-style firm that delivers industry-leading resources and support,” Thomas said in a statement.

“Ronin’s refreshing philosophy, coupled with Marshall’s history of entrepreneurship and Travis’ strength in advisory operation services, makes this firm an ideal fit with Cetera Advisors,” Brett Harrison, president of Cetera Advisors, said in a statement.

Sowell Management Acquires Northwest Arkansas Adviser Team

Sowell Management, a North Little Rock, Arkansas-based registered investment adviser, is expanding its state-wide presence with the acquisition of Sector Grid Advisors, an independent financial advisory team based in Rogers, Arkansas.

The acquisition brings an additional $120 million in assets and two seasoned advisers, Bob Taylor and Tonya McKaughan, under Sowell Management’s RIA umbrella.

“The northwest part of the state is anchored by national and worldwide companies like Tyson Foods, J.B. Hunt and Walmart, as well as exploding with small businesses and new population. We felt the time was right to make a boots-on-the-ground commitment,” Bill Sowell, the founder and CEO of Sowell Management, said in a statement.

Waverly Advisors Acquires Silicon Hills Wealth Management

Waverly Advisors LLC acquired Silicon Hills Wealth Management, based in Austin, Texas. Silicon Hills was co-founded by Tom Brown and James Werner in 2013 as a service-oriented wealth management firm.

Since 2021, Waverly has extended its regional footprint across the Southeast. This partnership is Waverly’s first in the Southwest region.

“As we continue to expand into new markets beyond the Southeast, we believe Tom and his team are the perfect fit to establish Waverly’s presence in Texas,” Josh Reidinger, CEO of Waverly, said in a statement. “Silicon Hills brings a fresh perspective to innovation and technology.”

Client Service June 16, 2023

Senior Safe Act Incentivizes Reporting Financial Exploitation of Seniors

Experts explained during a FINRA webinar that the act provides financial institutions immunity for reporting potential exploitation of senior citizens. 

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The U.S. House of Representatives recently passed a bill aimed at protecting older adults from financial scams, but it is not the first piece of legislation to tackle the issue. 

The Senior Safe Act, which became federal law on May 24, 2018, was designed to encourage reporting of financial exploitation of senior citizens, explained Lori Schock, the director of investor education and advocacy at the Securities and Exchange Commission, during a Thursday webinar about the legislation hosted by the Financial Industry Regulatory Association.  

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“It gives certain individuals and financial institutions immunity from liability in any big civil or administrative proceedings for reporting potential exploitation of senior citizens to certain entities if certain conditions are met,” said Schock. 

If staff at a financial institution has completed the appropriate training, then that firm can receive immunity when reporting suspected financial exploitation, which extends to supervisors, as well as employees on the compliance and legal teams, she explained. The immunity also applies to covered registered representatives, registered investment advisers and insurance producers affiliated or associated with the financial institutions. 

At the State Level 

Because not every state had passed such a rule, investment advisory firms did not have a safe harbor for certain aspects of the FINRA rules, according to Rich Szuch, the enforcement chief for the New Jersey Bureau of Securities.  

“We knew that there was a need to put together a model act that states around the country could use to create their own legislation, and in 2016, [the North American Securities Administrators Association] released its model legislation to protect vulnerable adults from financial exploitation,” said Szuch. “We call it the NASAA Model Act.” 

He said about 40 states have adopted its basic structure, but due to the different political preferences in each jurisdiction, not all states adopted laws identical in structure to the NASAA Model Act. 

Risks for Older Americans 

Measures like these have been put in place to protect the elderly because older adulthood poses unique risks to scam susceptibility and financial decisionmaking, said Olivia Valdes, a senior researcher at the FINRA Investor Education Foundation.  

As people age, they face normative and disease-related changes in cognition, reported Valdes. Even those subtle changes in cognition can impact decisionmaking, literacy and scam susceptibility. In fact, between 30 and 40% of older adults experience suboptimal financial decisionmaking. Mismatches between memory skills and perception of those skills tend to result in poor financial decisionmaking. 

Additionally, Valdes said that social isolation had a big effect on divorced and widowed adults. They tended to engage with, and lose money to, scams more often than those living with a spouse.  

The method of contact was important, too: Individuals who were approached online or via social media were much more likely to both engage with a scam and to lose money.  

Scams are clearly an issue top of mind for SEC officials, with an SEC task force on the matter proposed as part of the National Senior Investor Initiative Act of 2023, which heads to the Senate next. 

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