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Industry Spotlight > Clearing and Custodial Firms

Goldman Sachs Adds Its First Breakaway RIA, Picking Up $1B Merrill Team  

By Jeff Berman

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What You Need to Know

  • Beverly Hills Private Wealth is the first breakaway RIA to select Goldman Sachs for its custodial services.
  • Goldman Sachs was expected to enter the RIA custody business since acquiring Folio Financial in May 2020.
  • Steward Partners Global Advisory became the first RIA clearing and custody client for Goldman Sachs, in June 2021.

Goldman Sachs has thrown its hat into the breakaway RIA custodial business, picking up a $1 billion team that left Merrill Lynch and selected Goldman Sachs Advisor Solutions to provide custodial services.

Merrill Lynch didn’t immediately respond to a request for comment on Tuesday.

Goldman Sachs was expected to enter the RIA custody business since acquiring Folio Financial, a brokerage, custodian and fintech firm, in May 2020.

Steward Partners Global Advisory became the first RIA clearing and custody client for Goldman Sachs in June 2021.

“Goldman Sachs has agreed to reimburse our firm up to $400,000 for transition-related expenses that our firm may incur,” RIA Beverly Hills Private Wealth said in a Form ADV filing with the Securities and Exchange Commission.

BHPW is led by Scott Shagrin, Ira Ravitz, and Lisa Weiner, who collectively managed $1 billion in client assets at Merrill Lynch.

Based in Beverly Hills, California, the new RIA firm said Friday it caters to “successful individuals and multi-generational families” and specializes in investment management, risk management tailored planning and tax planning,

Through BHPW’s relationship with Goldman Sachs, the RIA said, it “will be able to provide their clients with sophisticated wealth management solutions backed by a highly respected brand in the marketplace.”

BHPW will be able to offer Goldman Sachs’ investment solutions, including “alternative investments, lending, capital markets, intellectual capital, as well as investment research and insights,” the RIA said. Those offerings were “previously reserved for institutional clients” and are now “available to the RIA community and the investors they serve,” BHPW added.

Shagrin and Ravitz have worked together since Ravitz joined Shagrin at Smith Barney in 1998. By then, Scott had already been running his book of business on his own for 15 years, BHPW said. They shifted to Merrill Lynch in 2006, where they were joined by Weiner as a partner in 2013.

“We had a great run at Merrill, but it is time for the next chapter,” according to Ravitz.

“We feel that creating our own fully independent RIA is ultimately in the best interests of our clients,” Shagrin said in a statement.

“During such uncertain times, our clients need advisors they can depend on wholly — advisors who are held to the highest fiduciary standards without conflicts of interest,” Shagrin added. “There are some who might think it would have been easier to simply move to another large broker dealer, but that would have been beneficial only for us. This move is not about us.”

In a statement, Goldman Sachs noted that, for more than 150 years, it has committed its “best talent, technology, and innovative ideas to further the success of our clients.” The firm expects to “add value” to BHPW’s business.

“There is room for a new custodian in the independent wealth management space, and we are excited to bring more choices to the market,” Goldman Sachs said. “We are incredibly focused on providing a best-in-class client experience and service level for advisors on our platform.”

“Our goal is to offer advisors the best of both worlds —  the freedom to operate as an independent RIA and the ability to access institutional-grade products and services,” according to Bill Dalton, head of new business at Goldman Sachs Advisor Solutions.

“Beverly Hills Private Wealth’s commitment to their clients and building an enduring business is aligned with our vision and goals,” he said in a statement.

 (Photo: Bloomberg)

Jeff Berman

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