On Monday and Tuesday, Securities America executives held a series of brief conference calls for the independent broker-dealer’s 1,800 advisors that focused on a settlement in the works involving the IBD, parent company Ameriprise Financial and attorneys for plaintiffs suing the firm over sales of private-placement shares in Provident Royalties and Medical Capital Holdings.
The calls were led by Jim Nagengast (left), CEO, and Janine Wertheim, vice president and chief marketing officer. According to a Securities America advisor who wished to remain anonymous and plans to leave the firm, the calls stressed the message sent by the company to reporters over the weekend.
“We made substantial progress in our mediation,” Wertheim said in an e-mailed statement on Saturday. Moreover, she wrote that “all interested parties have committed to a process that we hope will result in a full and final resolution of these matters.”
The company has declined to share other details about the negotiations. It also insists that its advisors are not departing due to the lawsuit.
Some experts, as well as some former advisors, say they hope the broker-dealer can overcome the present challenges. Meanwhile, they do expect some advisors to switch broker-dealers.
“This is unfortunate as I feel Securities America has been a solid IBD, its management (under Nagengast) is solid, and some 50 firms sold the [Provident Royalties] product,” said Chip Roame, head of Tiburon Strategic Advisors, in an interview Monday. “It seems Securities America is catching a worse rap than any other firm. That's unfortunate.”