Robert Moore left LPL Financial a year ago.

Though it is not official yet, Robert Moore is set to be named nonexecutive chairman of the board for the parent company of the Cetera Financial Group, according to a source familiar with the board selection process.

Moore, the former president of rival independent broker-dealer LPL Financial (LPLA), is expected to be tapped formally for the post when Cetera’s parent company, RCS Capital, wraps up its Chapter 11 procedures in May or June, the source adds.

“Consistent with any change of ownership, and as previously disclosed, we are putting in place a new board of directors upon the company’s emergence from the restructuring process,” said David Orlofsky, chief restructuring officer of RCS Capital Corp. and senior managing director of Zolfo Cooper, a restructuring services group, in a statement.

“Given Cetera’s strong value proposition, we’re confident that the new board will attract highly respected individuals,” Orlofsky added. “Beyond that, it would be premature to publicly discuss any details until board composition is finalized.”

As part of the restructuring arrangement, Larry Roth plans to stay on as CEO of Cetera Financial Group and “is looking forward to partnering closely with the new board of Cetera’s parent company to open a new chapter of growth for the organization,” explained Orlofksy.

Tuesday was the last day when objections to the company’s bankruptcy plan could be filed, and a search of public court documents did not reveal any further objections, a source familiar with the company’s bankruptcy process says.

Moore, who served as president of LPL Financial from May 2012 to March 2015, is now CEO of Legal & General Investment Management America, an asset manager, and should remain in that post while serving on the Cetera board.

BD Mergers 

Also on Wednesday, the firm confirmed that it likely will merge VSR Financial Services into Summit Brokerage Services and bring Investors Capital Corp. into Cetera Advisors.

“Based on extensive advisor feedback gathered across Cetera, we will be integrating both VSR and ICC within other firms in our network. We will be selective with respect to the advisors invited from these firms to affiliate with our network’s other broker-dealers, in order to ensure the best fit possible with our company’s broader mission and values following the completion of our transformation process,” said Joseph Kuo, a spokesperson for Cetera Financial Group, in a statement.

“We are taking this step to drive an enhanced and more focused support experience for selected advisors from these firms. We expect to share further details when we announce the completion of our transformation process soon,” Kuo explained.

At least one observer said that this consolidation makes sense.

“This shouldn’t come as a surprise, given that these firms never seemed like a very strong fit with the rest of the Cetera network,” said Jeff Nash, president of the Nash Consulting Group, a practice-management firm that has worked with several Cetera firms, in a statement.

“Cetera has been doing well with advisor retention …, and that’s a position the company won’t undermine by implementing any wind-down plans that treat advisors unfairly, even those the company may not want to invite to join its other firms going forward,” Nash explained. “Cetera appears to be providing impacted advisors with ample time to make decisions on where they should go next.”

The Firm’s Future

Could more changes be in the works?

“It’s very possible that the new Cetera will be modeled after LPL,” said Mark Elzweig, the head of a New York-based executive search firm, in an interview.

“Ultimately all of their advisors may be part of one broker-dealer, clearing through one custodian or the firm will self-clear like LPL. These mergers are probably interim steps,” Elzweig explained.

As for the tapping of Moore, “He looks like he has the depth of experience to [help] lead a large broker-dealer like Cetera,” the recruiter stated.

Others agree.

“Larry Roth and his management team clearly have the respect and confidence of Cetera’s advisors,” said Joan Khoury, chief marketing officer of Oppenheimer & Co. and former CMO of LPL Financial. “Should this [news of Moore’s future role] be true, this would be an enormous senior talent win for Cetera, which would be gaining an industry visionary who could support the existing Cetera leadership team in multiple ways going forward.”

After the bumps of the past two years, Cetera advisors probably appreciate any source of stability.

Past Problems

Earlier this year, RCS Capital filed for bankruptcy protection in Delaware.

At the time, Cetera said it planned to spend some $50 million on programs to retain the roughly 9,000 independent advisors affiliated with its network of broker-dealers who are eligible for such funding. RCS Capital had close to $2 billion in assets and roughly $1.4 billion in debts, according to a Bloomberg report.

In early January, RCS Capital said it had obtained $150 million to restructure its finances from a group of key investors. Also, private equity firms Carlyle Investment Management and Fortress Investment Group, along with asset manager Eaton Vance Management, are letting the company forgo debt payments. These entities are poised to see the money they are lending to Cetera turn into equity shares in the group of independent broker-dealers.

The Cetera-branded broker-dealers have likely offered retention deals only to reps who have $250,000 or more in average yearly fees and commissions, said Jon Henschen, a recruiter and head of Henschen & Associates, several months ago. Advisors and others in the industry have said the deals are roughly equivalent to 6% of an advisor’s trailing-12-month production level and will be paid in stock; these reps also will be eligible to receive another 2% of their yearly production in cash, according to Henschen.

In court papers, Orlofsky said the company took on debt through “significant acquisitions” costing over $1 billion.

In 2014, Lightyear Capital sold Cetera for $1.15 billion to RCS Capital, which at the time was led by Executive Chairman Nicholas Schorsch. Later in the year, an entity in the nontraded REIT space Schorsch was involved with became embroiled in an accounting scandal and related troubles, which spilled over onto RCS Capital. (He is no longer involved in the management of RCS Capital or Cetera.)

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