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January 29, 2019 at 02:55 PM
Wells Fargo Advisors rolled out its channel for registered investment advisors on Tuesday, becoming the first of the four wirehouse firms to do so. The firm intends to use the affiliation option in its push to add fee-only RIAs, but existing advisors with Wells Fargo, including employee advisors and independent reps in the Wells Fargo Financial Network channel, can also move to it.
(WFA President David Kowach described the bank’s intentions to move into the RIA space in early December at the 2018 MarketCounsel Summit meeting in Las Vegas.)
The program will allow RIAs to custody assets via Wells Fargo Advisors’ subsidiary First Clearing and use TradePMR, an outside firm, as their broker-dealer and source of office support. The RIAs affiliated with TradePMR can access Well Fargo’s bank products, trust services and related options, such as Envision investment planning software.
“We are adding a new affiliation option … to attract fee-only independent advisors, as part of our [daily] recruiting efforts for all our models,” said John Peluso, head of First Clearing, in an interview. “We are excited to grow by attracting financial advisors in motion.”
TradePMR will support advisors moving to the RIA channel and work with them to access its own advisor technology, Fusion, and Wells Fargo’s desktop technology, SmartStation, according to TradePMR founder and CEO Robb Baldwin, a former RIA.
WFA and TradePMR executives have been in contact since 2011. “This is not a knee-jerk reaction. It’s a long-term strategic play to open up a new channel to compete for talented advisors in motion. We’ve been discussion for some time about this and glad it is here now.”
The first advisor moved to the new channel earlier in January: Carl A. Schultz of Berwyn, Pennsylvania. Hewas an employee advisor for the past 15 years with Wells Fargo and has been in the business for 38 years.
“There’s been quite a bit of interest so far, and we expect more practices to follow,” said Peluso. While moving to the RIA channel requires due diligence on the part of the advisor, “We are finding that advisors that come to us are already educated about the opportunity to go fee only.”
