Top Banner Ad

DC Broker Dealers

By NAPA Net Staff • 11/24/2014 • 0 Comments

Not all broker dealers are created equal, especially when it comes to supporting plan advisors. Our list of broker dealers that have at least one person dedicated to the DC market has remained relatively stable. This is surprising given the increased attention being paid to retirement plans and the growing interest of advisors in this market. While all firms have a bit of support, the range of services, the commitment and the number of people dedicated to the retirement plan market all vary widely.

Though the advent of the Section 408(b)(2) disclosure rules did not cause the massive plan movement or complaints from participants that some had predicted, the big change is that advisors must declare whether they are acting as a fiduciary for the services being provided. As a result, advisors that might have flown under the radar (at least with brokers dealers not savvy about ERISA) were forced to come clean if they wanted to be a named fiduciary. This forced many to leave or think about leaving if their broker dealer doesn’t allow that. There was also massive poaching in the wire house ranks, with big payoffs being offered and some advisors going independent.

The stakes keep getting higher, with only a few BDs willing or able to invest or support what most consider a fringe market that has low margins and carries high liability. “Super groups” like Pensionmark and RBG that provide support, brand and buying power continue to grow and spawn competitors, while the larger specialty groups and original super groups prosper mightily.

Though they’re not broker dealers, trading and clearing firms like Schwab, TD Ameritrade and Fidelity are looking to entice advisors to go independent — while poaching each other’s RIAs.

After the issuance of the DOL’s expanded definition of fiduciary — now expected in 2015 — many more plan advisors will be considered fiduciaries, forcing them to adopt a level compensation model. While this is troublesome to BDs that have an absolute prohibition on that model, the real issue is whether the DOL’s rules will cover IRA rollovers. That would limit commission-based advisors, affecting almost all BDs.

With revenue sharing and marketing fees under heightened scrutiny in the new world of fee disclosure, and many DC providers unwilling to pay the growing charges to get access to a BD’s advisors, many broker dealers will be questioning how much they can afford to offer plan advisors in terms of resources. This will reinforce the trend of the rich getting richer — who, in turn, will attract more of the truly focused plan advisors.

Our BD list, updated in November 2014, is provided below. For a pdf of the list, click here. Here are some highlights on DC-focused BDs and RIAs:

  • Cetera – Though they have slowed down on their 12-broker-dealer acquisition spree over the last 18 months, RCAP BDs led by Cetera are planning big initiatives to support plan advisors. Those efforts will be led by Steve Dunlap, Jon Anderson, Guy Hocker and Jim Botsford.
  • LPL – They partnered with Chetney to buy Financial Telesis and launch Global Retirement Partners (GRP), which is essentially “NRP 2.0” with some interesting twists.
  • NFP – The purchase of all RPAG and 401(k) Advisor assets led by Vince Giovanazzo and Nick Della Vedova cements their strong interest in not only the plan market but also in pairing benefit advisors with plan advisors. They will also be more aggressive, acquiring practices like John Spach’s in SoCal, with another pending in the Southeast. 
  • AIG – The four BDs owned by AIG, to this point mostly absent from the DC plan market, will start making waves now that they have hired highly respected DC veteran Kelly Michel, who led Transamerica’s hugely successful MEP initiative and other ventures.
  • Calton – Led by industry icon John Simmers, this small independent BD based in Tampa is making bold moves in the DC market. Those moves are spearheaded by Amy Glynn, who helped Commonwealth build their plan support services.
  • HighTower – VC-backed HighTower has been mostly focused on luring wealth management wire house advisors with an interesting new model. Along the way, however, a few plan advisors — including Jim Pupillo, Steve Bogner and Jania Stout — have signed on. Hightower could become very active in this market; look for Dynasty to follow HighTower’s lead. 

Broker Dealers/Advisory Firms (44)

National (Employee) 9


Raymond James*



Edward Jones


Merrill Lynch

Wells Fargo Advisors*

Morgan Stanley

*Both Indy & Employee

Insurance 8



John Hancock

Northwestern Mutual





Independents 17



Advisor Group



M Financial


National Planning




Securities of America

First Allied

Stifel Nicolaus

Hilliard Lyons

United Planners



Specialty Groups 10*


NFP Retirement








Sheridan Road

* may clear through other BDs