LPL highlights service gains at annual Focus meeting

With top LPL financial executives pointing to a series of service improvements for its 14,000 advisers, CEO Mark Casady said Monday the firm was "rounding a corner" in its commitment to revamp the firm. LPL has made massive investments in technology and had moved past the "messy middle" of its "journey," Mr. Casady said, as LPL kicked off its annual meeting in San Diego. Over the past few years, LPL has faced serious headwinds. In 2014 and 2015, it paid a staggering $70 million in regulatory fines and restitution to clients for compliance failures, including deficiencies in the sales of high commission products such as variable annuities and nontraded real estate investment trusts. There were also several changes in senior management over that period of time. Rather than focus on problems of the past, Mr. Casady and other LPL top brass stressed service, compliance and technology improvements the company has delivered over the past 12 months. Waiting time is down sharply when advisers call the service center with questions. And compliance examiners bring doughnuts to advisers as a way to soften the sting of a surprise audit. Without discussing in detail the impact of the coming Department of Labor fiduciary rule for retirement accounts, senior LPL executives emphasized the way the financial advice industry is changing. "I've never seen this velocity of change," said Andy Kalbaugh, managing director and divisional president for relationship management and business consulting. "The change is not new but the velocity is enormous." LPL senior executives stressed the firm's achievements over the past year. The firm's service center has made many improvements but is not quite finished yet, said Tom Gooley, managing director for service, trading and operations. There has been a 25% increase in staff answering phones at the service center, and new programs were introduced to more efficiently track adviser questions, Mr. Gooley said. A year ago, advisers on average waited two minutes to have their calls picked up, he said. That time has since dropped to below 20 seconds. Likewise, Michelle Oroschakoff, managing director and chief risk officer, said that LPL's exams of advisers had been overhauled. "The days of the finger-wagging compliance officer are over," she said. "Branch exams are the biggest pain point for advisers." LPL has tried to make compliance and exams more efficient, she said, reorganizing teams and focusing on delivering faster responses to advisers' questions. And LPL's technology continues its upgrade, with the steady integration and introduction of its new wealth management platform called ClientWorks, said Victor Fetter, managing director and chief information officer. So far, several new capabilities, including a client home page, have been introduced, he said, adding that more is to come by early next year.