Voya Financial sees $600 million AUM group jump to Cambridge

A large, veteran group with more than 40 advisers and staff left Voya Financial Advisors Inc. the first week in May and now are registered with Cambridge Investment Research Inc.

A spokesperson for Cambridge, Cindy Schaus, confirmed the move of Vision Financial Group, which is based in Des Moines, Iowa, and has close to $600 million in client assets.

The lead partner at Vision Financial, Peter Hill, who had been registered with Voya for 16 years, did not return calls on Monday to comment.

"Voya Financial Advisors terminated Hill’s registration with the firm as [Voya] no longer wished to supervise Hill," Voya spokesperson Laura Maulucci wrote in an email.

She did not respond when asked why the firm didn't want to supervise Hill any longer. His BrokerCheck profile provides no reason for why Voya no longer wanted to supervise Hill.

Broker-dealers like Voya Financial — owned and operated by insurance companies — are in a difficult spot in the financial advice marketplace right now.

Many insurance companies, including giants like MetLife and American International Group, have dumped their broker-dealers in the past several years as a persistent low-interest-rate environment put pressure on the profitability of products like variable annuities, which are typically big sellers at such firms.

Such firms also have typically been underinvesting in their technology platforms to reduce costs, according to industry executives and recruiters. The level of technology spending at Voya Financial is not clear, but the executives and recruiters noted that other Voya Financial advisers are exploring the market and kicking the tires at competitors such as LPL Financial, Securities America Inc. and Lincoln Financial Advisors Corp.

But Tom Halloran, president at Voya Financial Advisors, wrote in an email that to the contrary, business at the firm is bustling. It has recently hired recruiters, successfully recruited advisers to join and entered an industry agreement known as the Protocol for Broker Recruiting, which makes it easier for advisers to move from one firm to another.

"Our recruiting efforts and investment in Voya Financial Advisors are active and yielding results," Halloran wrote.

Like most brokerage firms, Voya Financial has been trying to shift its advisers to charging clients fees for advisory services rather than commissions for selling products. In 2017, as the investment advice industry was preparing for the Department of Labor's fiduciary rule, which was eventually scrapped, the firm sent a memo to some of its advisers stating that advisers needed more training to be paid commissions.

"When licensing and training requirements are satisfied, commission payout will resume going forward, but forfeited commissions will be retained" by the firm, according to the 2017 memo.

Heavy-handed compliance at broker-dealers is a routine complaint among financial advisers. "Voya's business processing is complex and confusing," said one industry recruiter, who asked not to be named because he competes with the firm.

"Voya Financial Advisors established the requirement to best position all of its representatives to act in their client’s best interest by being licensed to offer clients the full range of products and services available through VFA, and not being limited to only brokerage products," Maulucci wrote.

Voya Financial Inc., the parent company of Voya Financial Advisors, has said publicly that it intends to focus on the retirement, investment management and employee benefits businesses, and its broker-dealer, Voya Financial Advisors Inc., is tucked under its retirement group.

But some in the industry say the insurer could be considering a potential sale of Voya Financial, which has roughly 1,700 reps and advisers, particularly as private equity funds are throwing money at and buying large broker-dealer networks like Advisor Group and Cetera Financial Group.