Forty Brokers Bolt Cetera
About 40 brokers affiliated with the Legend Group, one of Cetera’s 10 broker-dealers, have made good on their promises to secede.
The advisors, led by Rich Williams of Legend’s Williams & Co. agency in Grandville, Michigan, have joined PlanMember Financial Corp., a Carpinteria, Calif. firm with about 500 brokers who service $8 billion in assets.
Williams primarily sells 403(b) and 457(b) tax-sheltered annuity plans to educators within independent school districts, regional educational service agencies, and community colleges of the Michigan Retirement Investment Consortium, the companies said. Its advisors managed about $450 million, and produced about $4.4 million over the past 12 months, according to a source on the team. The small size of the accounts was one reason that Legend gave Williams scant attention, sources said.
The Legend Group, which includes about 400 advisors, is owned by Cetera Group’s First Allied Holding.
Dissatisfaction between managers of Legend and of First Allied is mutual, sources said. First Allied, which purchased Legend before it was itself bought by Cetera, views the public-sector annuities business as insufficiently profitable while Legend brokers and supervisors feel tainted by problems at Cetera and its parent company RCS Capital.
RCS filed for Chapter 11 prepackaged bankruptcy at the end of last month, and an official at PlanMember who asked for anonymity said the firm will try to attract more Legend advisors upset over the filing.
“I would say that the recent corporate changes, and the departure of their largest independent agency, is an indication that the future of The Legend Group does not include Cetera,” he said.