OppenheimerFunds reshuffles, lays off workers

Firm shakes up marketing department, creates new divisions; also adds new lawyer to senior staff

May 4, 2010 @ 3:43 pm

By Jessica Marquez

OppenheimerFunds has reorganized its marketing department, laying off about 20 employees and creating a division dedicated to providing investment commentary and research to clients.

The shake-up comes as the firm tries to reverse months of poor performance in its bond funds. OppenheimerFunds is also facing a number of lawsuits from states over its Section 529 plans.

Marty Willis, chief marketing officer, held a town hall meeting May 3 for OppenheimerFunds employees to announce the reorganization.

“We are changing our business model to be more customer-focused and to strengthen our investment-marketing expertise,” Robert Grill, senior vice president of marketing at OppenheimerFunds, said in an interview. “To do that, we need to get the right talent levels in the right places.”

Ms. Willis, a 25-year Fidelity Investments veteran, joined OppenheimerFunds in September to help the firm revamp its marketing strategy.

As part of her plan, Ms. Willis has created an investment services group, which will be made up of nine people and will focus on putting together investment management commentary to clients, Mr. Grill said. “There are a lot of smart people here, and we haven't done a great job of letting the world know what we think,” Mr. Grill said.

OppenheimerFunds has tapped Lori Heinel, who was managing director and head of investment solutions at Citi Private Bank, to head the new group. Ms. Heinel's first day is Aug. 1.

Separately, OppenheimerFunds has hired Ari Gabinet, the former head of securities litigation at The Vanguard Group Inc., as general counsel, asset management. Bob Zack, OppenheimerFunds' general counsel, will remain in his position. The hiring means Mr. Zack will able to focus more on strategic-business issues while Mr. Gabinet handles day-to-day legal issues, Mr. Grill said.

Given the events over the last several months, hiring more legal staff probably makes sense for OppenheimerFunds. In November, the firm paid $20 million to settle a lawsuit with Oregon over its management of the state's 529 plan. In December, the firm agreed to pay $44.23 million to the state of Illinois over its 529 plan.

The lawsuits alleged that OppenheimerFunds 529 plan managers invested too heavily in the company's' Core Bond Fund, which had place sizeable bets on subprime and higher-risk securities. The fund lost 36% of its value in 2008.

Getting portfolio manager commentary in front of investors may help OppenheimerFunds, but it remains to be seen if the firm will be able to turn itself around, said David Kathman, a mutual fund analyst at Morningstar Inc. “People are still shaken up over what happened with its bond funds,” he said.

0
Comments

What do you think?

View comments

Recommended for you

Featured video

Events

WisdomTree's Maute: Developing elegant tech-enabled solutions

Advisers need unique technology-enabled solutions in order to have more time to expand their practice, according to WisdomTree's Alisa Maute. What can be done today to create a more thriving business of tomorrow.

Latest news & opinion

Meet our 2017 Women to Watch

Introducing 20 female financial advisers and industry executives who are distinguished leaders, advancing the business of providing advice through their creativity and hard work.

Raymond James executives call on industry to keep broker protocol

Also ask firms to pay for the administration of the protocol to 'ensure its longevity and relevance.'

Senate committee approves tax plan but full passage not assured

Several Republican senators expressed reservations about the bill, and the GOP cannot afford too many defections.

House passes tax bill, focus turns to Senate

Tax reform legislation expected to have more of a challenge in upper chamber.

SEC enforcement of advisers drops in Trump era

The agency pursued 82 cases against advisers and firms in fiscal year 2017, down from 98 the previous year.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print