Deals & People November 16, 2023

Edelman Financial Engines Acquires PRW Wealth Management

The firm is looking to sync its growing wealth management footprint to retirement managed account offerings, according to its CFO.

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Edelman Financial Engines LLC on Thursday announced the acquisition of PRW Wealth Management LLC, a registered investment adviser headquartered in Quincy, Massachusetts.

PRW manages more than $500 million in assets under management for approximately 200 clients, including individuals, families, endowments and foundations, and business owners. The firm provides a range of wealth management capabilities, focusing on strategic planning, investment management and wealth transfer, according to the announcement.

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PRW is the fifth acquisition made by Edelman in the past 13 months, continuing the expansion of the firm’s wealth planning capabilities across key regions nationwide. As a leader in retirement plan managed account offerings, Edelman’s Suzanne van Staveren, executive vice president, chief financial officer and chief operating officer, believes more employers are seeing the need to help employees, both within and beyond their 401(k) account.

“Our managed accounts have been available in the workplace for nearly 20 years, and we have continued to expand the offering to help with retirement income and planning,” she wrote in an email. “More employers are recognizing the need for holistic, comprehensive financial planning and investment advice, especially for employees who have more complex needs and who are increasingly looking to their employers for this support. With our industry-leading network of retail financial planning and wealth management professionals, Edelman Financial Engines is uniquely positioned to provide this help.”

Edelman offers an in-plan experience, its planners are free of product conflict and the firm can manage both qualified and nonqualified assets, something few IRAs can do, according to Staveren. This is especially relevant as many employers seek to retain assets in plan.

“Depending on the client’s preference, we can help manage those assets in the plan or through a rollover,” she said. “With our wide range of services, we can help employees who prefer tools like online advice all the way to holistic discretionary financial help with a dedicated adviser.”

The PRW transaction follows Edelman’s acquisitions of Align Wealth Management (2023), Erman Retirement Advisory (2022), Herrmann & Cooke (2022), Smart Investor (2022) and Viridian Advisors (2021).

“We work with some of the largest employers in the country who have a nationwide footprint,” said Staveren. “Our recent acquisitions have been in markets where we also see significant overlap with retirement plan participants, particularly in the Pacific Northwest, California and now in the greater Boston area.”

Growth through acquisition remains a key area of focus for Edelman, and the firm expects activity will increase in the coming quarters as it continues conversations with partners, according to a company statement.

“Joining Edelman Financial Engines provides us with a depth of additional resources and the ability to maintain the feeling of a multi-family office,” said Rick Renwick, co-founder of PRW, in a statement. “We look forward to delivering cost-effective and tax-efficient customized portfolios built upon the investment philosophy of Nobel Prize-winner and Edelman Financial Engines co-founder Dr. William F. Sharpe.”

Baker & McKenzie LLP and K&L Gates LLP served as Edelman’s counsel in connection with the transaction. Ballard Spahr LLP served as PRW’s counsel.

Client Service November 16, 2023

Ascensus, Newport Nonqualified Platforms Hit by Infosys Cybersecurity Issue

Ascensus and its Newport-owned nonqualified retirement systems have not been able to update participant accounts since November 2.

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Ascensus and its subsidiary, Newport Group Inc., have had their nonqualified retirement plan services affected by a cyberattack on business processes firm Infosys McCamish Systems LLC.

The platform that Ascensus and Newport use has not been able to update nonqualified user accounts since November 2. The firms are seeking a solution by November 17, according to a company spokesperson and a customer service letter sent to an account holder. 

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“The platform we use to support aspects of our nonqualified retirement plan administration services has been affected by the Infosys McCamish outage since November 2,” a spokesperson said via email. “We have been communicating regularly with our clients and participants since that time, and our systems are not impacted. Account values will be accurately reflected once full functionality has been completely restored. We have apologized for any inconvenience or concern this has caused.”

Infosys BPM Ltd., based in Bangalore, India, released a statement November 3 that its U.S. subsidiary, Infosys McCamish, had been made aware of a “cybersecurity event resulting in non-availability of certain applications and systems in IMS.” The firm noted it is working with a “leading cybersecurity products provider” to resolve the issue.

Infosys McCamish provides platform-based services to more than 40 insurance companies “across a broad array of insurance products, distribution models and platform deployment options,” according to its website. It lists retirement industry services that include nonqualified support, qualified defined contribution administration and qualified defined benefit administration. On Thursday, a spokesperson said Infosys BPM had no further information beyond the November 3 statement.

Ascensus, which acquired Newport in 2021, is listed as the second-largest NQDC provider by participants with 135,217 account holders, according to PLANSPONSOR’s 2023 NQDC market survey. 

Ascensus started investigating the issue on November 2, according to the spokesperson.

A Newport letter to at least one account holder shared with PLANADVISER stated that had no evidence that plan data had been “exfiltrated or disclosed to the public.” The account holder requested their name not be used. 

“We do not expect the technical issues to be resolved before November 17 and will continue to update your Dashboard’s Messages with further updates,” Newport wrote in the customer service letter.

Newport is logging all retirement plan transactions submitted after market close on November 1 to be processed once the system is restored, according to the letter. Plan participants were told they can submit transactions as normal.

“Once the technical issues have been resolved, we will carefully review, update, and verify all transactions that have taken place during this period,” the letter said. “Once complete, you can rest assured that account values will be accurately reflected, and we look forward to resuming normal servicing of your plan.”

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