US Fiduciary offers a business model that is attracting ultra-high-end advisors who want to be fiduciaries.
Mary Ann Lambert did not have to be "sold" to move away from her
comfortable, 27-year retail brokerage environment. A former Smith
Barney advisor and wealth manager to ultra-high-net-worth clients,
Lambert made going independent a priority on her agenda. But, until
recently, she could not find the perfect fit for her practice, which
also includes prestigious institutional accounts. She needed a way to
seamlessly transition both retail and institutional clients, which
meant continuing to work with most of her money managers, as well as a
way to focus more on client development.
She found the right fit at US Fiduciary. Last year she made the move to the firm's broker-dealer, USF Advisors, and heads its Philadelphia branch. "[Many] independent broker-dealers merely provide clearing services and not much else," argues Lambert. "US Fiduciary has integrated a broker-dealer with a high-end RIA practice and an advanced asset management platform. The US Fiduciary comprehensive open-architecture platform and technology, including an institutional-quality hedge fund offering, enable me to meet the increasingly complex needs of high-net-worth and institutional clients."
At a time when many of the nation's largest brokerages are mobilizing vast resources in the nation's capital to avoid fiduciary responsibility, US Fiduciary is seeking to work only with those advisors willing to embrace that concept. This means that, unlike other colleagues at wirehouses, US Fiduciary-affiliated advisors won't have to tell the public that they may put their firms' own interests ahead of their clients'.
Moreover, as Lambert's case illustrates, more people at giant institutions are looking to work with a broker-dealer or custodian that regards them as a professional advisor, not a salesperson peddling products. "We view Mary Ann as a true partner," says US Fiduciary Principal Elliot S. Weissbluth.
The firm also provides advisors with concierge-style services to help smooth the transition. "We rented a space for her, provided the technology, and provided marketing and branding," says Weissbluth. "Two weeks after Mary Ann joined us, she closed a $17 million high-net-worth client. Recently, she closed a $3 million institutional client."
Lambert cited institutional-level consultants such as CRA Rogers Casey;
strategists such as Frank Russell, Standard & Poor's and Frontier
Asset Management; and prestigious hedge fund and private equity
managers as major reasons for staking her claim at USF. The education,
top-notch research and well-known technology through National
Financial's Streetscape platform also added to winning her over.
"The main thing US Fiduciary offers us are the upscale services we can't get from a general, typical independent platform or your standard independent broker-dealer," says Marc H. Pershan, executive vice president and director of private banking for New Century Bank in Chicago.
Scott K. Davis, CEO and president of Addison Avenue Financial Advisors in Palo Alto, Calif., agrees with Pershan and adds, "The research aspect, hedge fund and private equity components have been big for us, for our higher-net-worth clients." Davis' firm works with members of the Hewlett Packard and Agilent Credit Unions, among others.
According to US Fiduciary principal Scott A. MacKillop, "Many of Addison Avenue's advisors use the asset management platform for their clients, and they have become an excellent client of ours." In fact, Davis attributes the recent acquisition of a $2.2 million account to the state-of-the-art platform. "Our clients are really enjoying the reporting they're getting from the system," he explains. "We wouldn't have gotten that account if we hadn't had the front-end process provided by USF, as well as the product offerings."
Those are all the ingredients US Fiduciary principals Steven J. Graubart, MacKillop and Weissbluth used to build their new firm-a unique business model and a service platform for high-end independent advisors. "Let's pretend there are no walls," says MacKillop, divisional president of the new firm. "That way, we can bring elements in from the outside or create them ourselves and not have a bias one way or another-or feel everything has to be created here."
US Fiduciary also has some heavyweight investors behind it, including advisory board member Mayo A. Shattuck III, the former chairman of Deutsche Bank Alex.Brown. "I am involved with US Fiduciary because I have great respect for Steven Graubart as a businessman, an entrepreneur," he says. "I have confidence in his leadership skills and his ability to build a world-class financial services organization."
Today, Shattuck serves as chairman, president and chief executive officer of Baltimore-based Constellation Energy Group Inc. (a Fortune 500 company that owns energy-related businesses). He was intrigued by he firm because it "has become an advocate for the independent model in which advisors are free to serve their clients without potential conflicts and pressures to market proprietary products and services."
Says Shattuck, "Given the challenges facing financial services professionals over the past few years, [the unique business model of USF], allows its advisors to maintain true independence and the ability to look our for their clients' best interests.