Advisers show Romney the money

Oct 21, 2012 @ 12:01 am

By Mark Schoeff Jr.

Mitt Romney
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((Photo: Bloomberg News))

Financial advisers are voting for Republican presidential candidate and former Massachusetts Gov. Mitt Romney with their wallets, following the same path as employees of the major banks and wirehouses.

An InvestmentNews analysis of Federal Election Commission data shows that presidential campaign donations from the employees of the largest registered investment adviser firms and broker-dealers heavily favor Mr. Romney.

These employees combined have given $199,747 to Mr. Romney and $93,453 to President Barack Obama during the 2012 campaign cycle, which began in January 2011. The numbers are based on donations through Aug. 31.

Firms can't contribute directly to a presidential candidate.

Some in the industry aren't surprised that Mr. Romney has the advantage among employees of advisory firms.

“President Obama has disappointed a lot of the financial industry on a lot of issues,” said Jason Hochstadt, executive vice president of registered investment adviser Jedi Management Inc.

"HAS A RECORD'

“He now has a record. That's why more money is going to Romney,” Mr. Hochstadt said.

Still, investment advisers agree that while the sector leans toward the conservative side of the political spectrum, donating can be as varied as individual political preferences.

“Traditionally, I do think the advice sector leans Republican,” said Pamela Sandy, founder and chief executive of Confiance LLC. “But more than that, the advice sector likes to hedge its bets.”

Donations from RIAs and broker-dealers follow the trend set by employees of the large financial services firms, which represent Mr. Romney's top eight contributors.

Those are, in order, the employees of The Goldman Sachs Group Inc., Bank of America Merrill Lynch, JPMorgan Chase & Co., Morgan Stanley, Credit Suisse Group, Citigroup Inc., Wells Fargo & Co. and Barclays PLC, according to the Center for Responsive Politics.

The totals ranged from the $891,140 that employees of Goldman gave to the $403,800 from those who work for Barclays.

Meanwhile, employees of Wells Fargo collectively represent the 18th-biggest donor to President Barack Obama. Wells is the only financial services company among his top 20 supporters. His top five contributors are employees of the University of California, Microsoft Corp., Google Inc., Harvard University and the U.S. government.

But while Mr. Romney is pulling in more campaign cash from the financial services industry, Mr. Obama is outpacing him in total fundraising.

As of the end of August, Mr. Obama had raised $432 million compared with Mr. Romney's $279 million. In September, Mr. Obama and Democratic groups raised $181 million, while Mr. Romney and Republican organizations raised $171 million.

Presidential donations from top executives in the investment advice sector have been mixed.

Those giving to Mr. Romney include Steven Kandarian, chief executive of MetLife Inc. ($5,000), Mark Sear, CEO of Luminous Capital LLC ($1,500), and F. William McNabb III, chairman and CEO of The Vanguard Group Inc. ($1,000), according to the Center for Responsive Politics.

On the other side, Elliot Weissbluth, CEO of HighTower Advisors LLC, and Laurence Fink, chairman and CEO of BlackRock Inc., each have donated $5,000 to Mr. Obama.

The split in candidate contributions also is evident within firms. At the Pacific Investment Management Co. LLC, for instance, CEO Mohamed El-Erian has given $2,500 to Mr. Obama, while Neel Kashkari, managing director and head of global equities, has given $5,000 to Mr. Romney.

Federal law limits individual political donations to $5,000 per candidate, per election cycle. Corporate and other political action committees can give $10,000 per candidate, per cycle.

The heavy support for Mr. Romney this year from the investment advice sector stands in sharp contrast to the 2008 campaign, when employees of the top 10 RIAs and top 10 independent broker-dealers gave $142,611 to Mr. Obama and $70,760 to his opponent, Sen. John McCain, R-Ariz.

SUPER-PAC MONEY

David Yeske, managing director of financial planning firm Yeske Buie Inc., is sticking with Mr. Obama. He has contributed more than $3,000 to the president.

Mr. Yeske said he likes it that Mr. Obama listens to experts and takes an “evidence-based” approach to economic policy, which he said has “kept us from going over a horrific cliff.”

He is uncomfortable with what he describes as an ideologically driven Republican fiscal agenda.

“Republicans are about tax cuts and nothing else,” Mr. Yeske said.

One of the GOP's strongest supporters is from the investment advice sector. J. Joseph Ricketts, the founder and former chief executive of TD Ameritrade Holding Corp., has established a so-called super-PAC that has spent $4.7 million this election cycle in support of Republican political candidates.

The advent of super-PACs followed a 2010 Supreme Court ruling on campaign finance. The organizations have no contribution ceiling and can spend unlimited amounts on behalf of a candidate — through television advertising, for instance.

They can't make a donation directly to a candidate.

The super-PAC that has received the most support from employees of the top RIAs and independent broker-dealers is The Club for Growth Action, which backs conservative candidates.

The top RIAs, by assets under management, are Financial Engines Advisors LLC, Hall Capital Partners LLC, Silvercrest Asset Management Group LLC, Chevy Chase Trust Co., Oxford Financial Group Ltd., SCS Capital Management LLC, Comprehensive Financial Management LLC, Rockefeller Financial, Tag Associates LLC and Aspiriant LLC.

The top independent-contractor broker-dealers, by assets under management, are LPL Financial LLC, Ameriprise Financial Services Inc., Raymond James Financial Services Inc., Lincoln Financial Network, Commonwealth Financial Network, Axa Advisors LLC, MetLife Securities Inc., Wells Fargo Advisors Financial Network, The Northwestern Mutual Life Insurance Co. and Securities America Inc.

mschoeff@investmentnews.com Twitter: @markschoeff

“PRESIDENT OBAMA has disappointed a lot of the financial industry on a lot of issues.”

Jason Hochstadt

Executive VP

Jedi Management

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