Advisers shutter offices to brace for Hurricane Matthew's punch

Southeastern firms likely will get to test those enhanced continuity plans the SEC is pushing.
OCT 06, 2016
As Hurricane Matthew forces evacuations in Florida, Georgia and South Carolina, financial advisers in the Southeast are preparing to test out continuity plans the Securities and Exchange Commission has been pressing them to enhance in recent months. The worst of the Category 4 storm is set to hit eastern Florida late Thursday or early Friday morning. Hurricane Matthew already has killed 114 people, most in Haiti. “The palm trees are already bending and the winds are blowing,” said financial adviser Austin Frye on Thursday afternoon. Mr. Frye closed his Aventura, Fla., firm at 3 p.m. on Wednesday and expects to remain closed for days. Frye Financial Center, located in one of the first U.S. cities the hurricane is likely to hit, sent clients a note Wednesday letting them know about the closing and providing them with a phone number of custodian LPL Financial if they needed help with accounts. (More: Advisers look back on 10th anniversary of Hurricane Katrina ) Those in the 12-person office left yesterday with a company phone tree they'll use to make sure everyone gets through the storm and its aftermath, Mr. Frye said. RAYMOND JAMES A gathering of advisers in Florida was cut short Thursday. The women advisers' conference Raymond James Financial was hosting in Orlando was called off after getting through its first day of sessions and speakers Wednesday. Carolyn McClanahan, the director of financial planning at Life Planning Partners in Jacksonville, Fla., said her firm closed early Thursday and will remain shuttered Friday when the brunt of the storm is due to hit her town, in the northeastern part of the state. “The crew is busy implementing our disaster plan,” she said. The SEC proposed a rule in June that would require registered investment advisers to have written business continuity plans, as well as details for how they would transition client accounts, should a disruption occur. Most of these emergency plans already are required, but the SEC is seeking to further ensure an advisory firm's clients are not harmed if there is a major interruption to the regular operations of the business. HURRICANE SANDY Securities regulators began looking at the need for such a rule after some financial advisory firms had trouble bouncing back after Hurricane Sandy in 2013. Hurricane Matthew is the first storm of this size to hit Florida since Hurricane Wilma landed in October 2015. It caused more than $20 billion in damage in the U.S. For perspective on the possible impact of the storm, Walt Disney World in Orlando is closing early Thursday evening, only the fourth time in its 45-year history. Advisers further north also were preparing for Hurricane Matthew's wrath, with many firms already closed in Savannah, Ga., and Charleston, S.C. “We're about a quarter mile from the Charleston Harbor, so any kind of surge and we'll have water around our toes,” said Bill Prewitt, founder of Charleston Financial Advisors. In anticipating of such events, the firm moved all of its systems and data into the cloud. Mr. Prewitt said he hopes to send an email tomorrow after the storm hits to test the firm's communications ability in an emergency and include the results as part of his compliance testing.

Latest News

In an AI world, investors still look for the human touch
In an AI world, investors still look for the human touch

AI is no replacement for trusted financial advisors, but it can meaningfully enhance their capabilities as well as the systems they rely on.

This viral motivational speaker can also be your Prudential financial advisor
This viral motivational speaker can also be your Prudential financial advisor

Prudential's Jordan Toma is no "Finfluencer," but he is a registered financial advisor with four million social media followers and a message of overcoming personal struggles that's reached kids in 150 school across the US.

Fintech bytes: GReminders and Advisor CRM announce AI-related updates
Fintech bytes: GReminders and Advisor CRM announce AI-related updates

GReminders is deepening its integration partnership with a national wealth firm, while Advisor CRM touts a free new meeting tool for RIAs.

SEC charges barred ex-Merrill broker behind Bain Capital private equity fraud
SEC charges barred ex-Merrill broker behind Bain Capital private equity fraud

The Texas-based former advisor reportedly bilked clients out of millions of dollars, keeping them in the dark with doctored statements and a fake email domain.

Trump's tax bill passes senate in hard-fought victory for Republicans
Trump's tax bill passes senate in hard-fought victory for Republicans

The $3.3 trillion tax and spending cut package narrowly got through the upper house, with JD Vance casting the deciding vote to overrule three GOP holdouts.

SPONSORED How advisors can build for high-net-worth complexity

Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.

SPONSORED RILAs bring stability, growth during volatile markets

Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.