The wealth management arm of embattled investment bank B. Riley Financial Inc. this week watched another of its leading financial advisors bolt out the door, with Eric Lyon, senior managing director, B. Riley Wealth Management, jumping to Kestra Investment Services.
Lyon’s LinkedIn page says he is co-owner of the Boca Raton, Fla. branch of B. Riley Wealth Management and chairman’s council member, a designation given to top revenue producers at broker-dealers.
“When a large, affluent financial advisor leaves any firm, especially one that’s going through some sort of turmoil, it’s smoke for the other advisors and a cause for concern,” said Jeremy Belfiore, CEO of Trusted Visions Placement & Consulting, a recruiting firm.
“Those senior advisors are usually privy to information from the top that others don’t have,” he said. “It makes you wonder what’s next.”
B. Riley is under considerable pressure following a plunge in its share price amid an SEC assessment of whether the firm correctly disclosed risks in some of its assets, and questions about its founder’s interactions with Brian Kahn, the former CEO of Franchise Group Inc., who stepped down in January after Riley participated in its leveraged buyout.
Reuters reported last month that Stifel Financial Corp., which has experience in making deals to acquire struggling financial services firms, was in talks to buy B. Riley’s retail brokerage group for $100 million. InvestmentNews has since confirmed that B. Riley is indeed exploring a sale of its financial advisor business.
Lyon isn’t the only high-profile B. Riley advisor recently to head for the exit.
Philip Wunderlich, the scion of the founder of the former Wunderlich Securities, which B. Riley acquired in 2017, also left the firm last month and joined Prospera Financial Services Inc.
It’s not clear the number of assets that Lyon and Wunderlich controlled, but market sources said they were significant financial advisors for B. Riley. Lyon could not be reached on Thursday to comment about his changing firms.
“B. Riley Wealth Management has a robust and talented team of financial advisors that continue to serve our clients,” a company spokesperson wrote in an email. “We wish the very best to the advisors who recently left for personal reasons.”
B. Riley’s wealth management group has two parts. Gary Wunderlich sold Wunderlich Securities in 2017 to B. Riley for close to $70 million. It then took a stake in National Holdings Corp. and eventually acquired the firm in 2021.
Last month, chair, co-CEO and company namesake Bryant Riley informed the board of directors of his intention to take the company he founded private, with a proposed purchase price of $7.00 per share. He is currently the firm’s largest shareholder with a 24% stake.
The financial advice industry has been facing inquiries into its cash sweep programs for years now.
Investor money allegedly went to strip clubs, exotic cars, and landscaping
Procyon adds $415 million in assets under management in New Jersey while Savant picks up a $213 million Southern California planning firm
With a growing number of real estate-rich Baby Boomers aging into retirement, some advisors may be failing to consider all the options available for those clients' assets.
Cornerstone Advisors study reveals compliance bottlenecks stall campaigns weeks after customer opportunities close.
As AI makes financial information more accessible than ever, Lana Hock explains why human judgment, trust, and empathy remain the qualities clients value most in a financial advisor
Northern Trust’s Ken Lassner shows advisors how to convert volatility into after-tax portfolio gains
