Advisers on the Move

Half a dozen Midwest advisers bolt from Waddell & Reed

The broker-dealer, which has seen an exodus of brokers in the last couple of years, lost six more experienced advisers last week

Aug 28, 2018 @ 1:54 pm

By Bruce Kelly

Even as it seeks to build a more profitable business model, Waddell & Reed is seeing more experienced, productive financial advisers walk out the door, losing a half dozen in the Midwest in little more than a week.

Three — Mike Smith in Louisville, Ky., and Gregg and Shelly Fogel in Cincinnati — last week moved to LPL Financial, according to their BrokerCheck reports. And a three-person team in Jeffersonville, Ind. — Gary Bouch, Brian Coxon and Matthew Wagner — also left Waddell & Reed last week to establish their own RIA, Oxinas Partners Wealth Management.

The company, which has seen an exodus of brokers in the last couple of years due mainly to new minimum production requirements, has said publicly that it wants to concentrate on its top producing reps and advisers.

"As we continue our path toward a stand-alone, profitable broker-dealer, we are focused on retaining high-performing advisers and seek to further rightsize the adviser model," said Shawn Mihal, president of the broker-dealer during a call with analysts in May.

Gregg and Shelly Fogel had worked at Waddell & Reed for 21 and 22 years, respectively. Mr. Fogel did not respond to a request on LinkedIn to comment, and Ms. Fogel did not return a call to comment. Mr. Smith, who could not be reached for comment, had been at the firm for 17 years. It was not known how much in annual fees and revenues those advisers generated.

According to Waddell & Reed, the advisers at Oxinas Partners had close to $1.7 million in fees and revenues last year. Mr. Bouch said the amount was $2.2 million in annual revenue, and that the team has $220 million in client assets. The team will custody assets with Schwab Advisor Services and run brokerage accounts through M.S. Howells & Co.

"We decided to make the jump to Schwab for a variety of reasons, including a greater variety of products, back-office support and the ability to keep more of our revenue," said Mr. Bouch, who had been at Waddell & Reed for five years.

The latest departures from Waddell & Reed come on the heels of a top team in Northern California, Elaine and Scott Manley, leaving to join an existing RIA on Aug. 16. The Manleys ranked number 11th at the firm and produced $1.6 million in annual fees and commissions.

When asked about the recent rash of advisers in the Midwest leaving Waddell & Reed, Roger Hoadley, a spokesman replied: "Our firm continues its evolution and, while that process will see departures and additions along the way, our focus is on executing on our strategy toward growth and advancement in support of our network of experienced financial advisers around the country."

The broker-dealer arm of parent Waddell & Reed Financial Inc., Waddell & Reed Financial Advisors, reported at the end of last month that it had continued to lose reps and advisers in the second quarter, although at a much slower pace than in the past.

On a year-over-year basis, head count was down 28.5% through the end of June, and stood at 1,130. As InvestmentNewspreviously reported, the bulk of brokers and advisers leaving Waddell & Reed did so in the second half of last year.


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