The Financial Planning Association is trying to put a messy divorce with its New York chapter in the rearview mirror and has carved out a niche within its organization to continue serving New York-area financial planners amid a transition to new local leadership.
The FPA, a national group with dozens of local affiliates around the country, created the FPA of Metro New York in early June to take over the responsibilities and membership of the FPA of New York, according to Metro chapter head Scott Kahan.
Infighting among FPA of New York's board of directors
led the national FPA organization to terminate its relationship with the chapter, among its largest nationwide. The turmoil had reached a level of "dysfunction" that "required FPA to take immediate action," FPA officials
said in a communique at the time.
It took charge of the chapter's operations around the end of March and facilitated a leadership change. The FPA national organization also assumed control of the FPA of New York's assets, as directed by the terms of their affiliation agreement.
Mr. Kahan and chapter executive Clary Delano will meet with potential candidates for the FPA of Metro New York's board of directors over the next month or so, and an official board will assume leadership in January, said Mr. Kahan, who was tapped by the FPA to serve as chair of the new group.
The FPA of Metro New York is set up differently than other local FPA chapters, of which there are
more than 80 around the country.
The other FPA chapters exist as separately incorporated nonprofit entities. They operate on behalf of the FPA via affiliation agreements the national group has with the local chapters.
The FPA of Metro New York is a "subset" or "community" under the umbrella of the national FPA, an arrangement that's similar to how the group treats communities like NexGen, said David Brand, director of strategic operations.
Mr. Brand said this new structure for the FPA of Metro New York, which has more than 550 members in and around New York City, was the "easiest path" to keeping members' services intact amid the turmoil, rather than "go through the hoops and the processes of creating another legal entity."
As for the FPA of New York, that entity is currently in limbo. The national FPA terminated its affiliation agreement with the group amid its takeover of the chapter's operations; the legal entity still exists, but the group can't do business of behalf of the FPA.
"Our recommendation to [their board] was to simply dissolve," Mr. Brand said, although that hasn't yet occurred. "There's no practical reason for them to exist."
He and Mr. Kahan said they'd heard of people resigning from the FPA of New York board, but were unsure of which individuals remain since the duo no longer have dealings with the chapter.
Mr. Kahan said some of the leaders of FPA of New York are serving as volunteers in the new group. He declined to identify those individuals.
However, Devika Kamboh has not been among the active volunteers, he said. Ms. Kamboh, president of the FPA of New York, brought the group's struggles to light in a complaint she filed March 27 with New York State's Charities Bureau.
Ms. Kamboh alleged that certain board members were engaging in self-dealing via an improper client-solicitation scheme; she also claimed that she was the subject of discrimination and gender bias, and that the national FPA had failed to protect her from a "hostile FPANY Board."
Neither Ms. Kamboh nor the New York Charities Bureau returned requests for comment by press time. Mr. Brand of the FPA said the organization hadn't been contacted by the attorney general's office regarding the complaint.
