Schwab gives Bernie Clark reins over RIA business

The Charles Schwab Corp. today handed the reins of its RIA custody business to Bernard “Bernie” Clark, who had run sales and relationship management for the Advisor Services group.
The promotion marks the first time since Charles Goldman was pushed aside as head of the business in November 2008 that a single executive will be focused solely on Schwab’s industry-leading custody platform. When Mr. Goldman left, the registered investment adviser business was consolidated with Schwab’s retirement services business under the leadership of Jim McCool, who ran retirement services.
“While the people on my leadership team aren’t changing, their functions and charters are as we unite sales, service, operations, technology and financial accountability under one leader for each of our institutional businesses,” Mr. McCool, Schwab’s executive vice president of institutional services, wrote in an internal memo. “Schwab Advisor Services will now report solely to Bernie Clark.”
Trish Cox, who was chief operating officer of the RIA unit, is taking a new role running corporate brokerage services, a Schwab unit that includes stock plan administration, mutual fund clearing, investment-only sales to employers and directed, or designated, brokerage. “We’re making these changes to further sharpen our focus on each of the unique institutional businesses and expand leadership opportunities for both Bernie and Trish,” wrote Mr. McCool, who came under some fire from advisers during his early tenure for failing to reach out to them beyond the retirement business that he ran.
Mr. McCool and Benjamin Brigeman, head of Schwab’s retail brokerage business, are both protégés of Schwab chief executive Walter Bettinger, who sold his retirement plan servicing business to Schwab in 1995.
The moves come amid a stressful time for retail brokerages. To maintain market share, the firms have been waiving hundreds of millions of dollars in money market fees, cutting brokerage commission prices and waiving selective fees for retail investors and advisers. Fidelity Investments on Thursday that it has cut commissions across the board for online trades to $7.95, down from as much as $19.95 previously. The company is also waiving commissions on the iShares family of 25 exchange-traded funds. Schwab last month lowered its online trades to $8.95 a trade, from as much as $12.95, and waived fees on Schwab’s proprietary family of six ETFs.
The rejiggering at Schwab also comes as Fidelity deals with its own management shifts. The firm last week indicated that Mr. Goldman, who joined the privately held company last year to head its RIA custody and correspondent clearing units, is leaving in March to pursue other opportunities.
Mr. Clark joined Schwab in 1998 as senior vice president for institutional trading and operations and also spent time as a client services representative in its retail brokerage unit before moving to the RIA custody sales unit. He has also worked in operations and sales positions at Morgan Grenfell in London, and at the former Salomon Brothers and Emigrant Services Bank. Mr. Clark received a B.S. in accounting from St. John’s University in New York.

Advisers’ initial reaction to the move was muted. “My immediate reaction is to take them at their word,” said Greg Friedman, president and cofounder of Private Ocean, a San Francisco Bay-area RIA formerly known as Salient-Friedman Wealth Management. “They are trying to restructure things a little, creating some opportunity for managers and better focus.” Mr. Friedman said that aside from startup glitches involving custody of alternative investments after Mr. McCool took over, Schwab’s services have continued on a high level.
“I’m confident that Bernie’s long tenure and understanding of the advisor business will continue to provide value, and help you focus on your clients and grow your business,” Mr. McCool wrote in his memo.
Bradley Alford, head of Alpha Capital Management in Atlanta, which moved most of its client assets to Schwab from Fidelity 18 months ago, said he has never met Mr. Clark and had no immediate reaction. “As long as they leave us alone and let us do our thing, I am satisfied,” he said.
Schwab spokeswoman Alison Wertheim did not return a call seeking comment about the changes.