Download FIRMS, FAMILY OFFICES TURN TO WEALTH COUNSELORS LAW

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FEBRUARY 9, 2009
VOL. XVI, NO. 3
Making Way For Merrill
Wells Names Wachovia’s
Kelly To Regional Post
Bank of America, US Trust Private Wealth Management is downsizing its 34 hubs across
the U.S. by as much as half and reorganizing certain offices in an effort to reduce costs and
to make way for the integration of Merrill Lynch offices. It is also in the process of
combining its multi-family office with Merrill’s Family Office Services division.
As part of the restructuring, some hubs will shut down and others will be rolled into
existing hubs in an effort to avoid overlap with Merrill’s Private Banking & Investment
Group offices. A spokesman said there will be more announcements in the coming weeks on
which offices will officially close and which regional heads will now have expanded coverage.
So far, the Baltimore and Washington, D.C. hubs have been eliminated and advisors will
BofA, UST REORGANIZES, REDUCES HUBS
Wells Fargo has appointed Stan
Kelly, former president of Wachovia
Wealth Management, as regional
president for North and South Carolina
following its recent acquisition of
Wachovia.
See story, page 2
Firms & Services
Bessemer Nabs Barclays Exec
Merrill Tax Pro Joins N.J. Firm
White Paper Favors CRUTs
Merrill PBIG Scoops Up $2B
Krawcheck To Co-Host Book Launch
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Family Office
Safra Family Offices Loses
FoF Specialist
Tax Pro Jumps To Tag Associates
Bessemer Taps Business
Development Officer
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Research
Discontented Wealthy Moved Assets 7
Advisors Underestimating
HNW Fears
8
Departments
On The Move
Wealth Management Happenings
Heidi Nedwurth
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(continued on page 11)
Finding Bay State Bounty
LAW FIRMS GETTING INTO THE HNW ACT
Massachusetts law firms have been rolling out family office or wealth advisory divisions.
They say they are seizing the opportunity to attract wealthy, multi-generational families,
many of whom have been self-managing their assets for generations. These families are now
seeking outside managers but are disillusioned with larger banks in the wake of the
financial crisis.
In Massachusetts, law firms can act as fiduciaries and offer investment advisory services
for clients. Boston law firm WilmerHale set up family office unit Silver Bridge Advisors last
fall (PAM, 10/6), which operates independently but taps into the law firm’s tax, estate
planning and fiduciary services.
Wilmington Trust bought Boston law firm Bingham Legg last year as a way to enter the
(continued on page 11)
FIRMS, FAMILY OFFICES TURN TO
WEALTH COUNSELORS
Some family offices and firms are tapping into wealth
counselors, typically psychologists or therapists with
specialized training in the behavioral and emotional
issues of wealth, as a way to better interact with and
understand their wealthy clients during the
turbulent markets.
Calibre, Wachovia Wealth Management’s
multi-family office, recently hired another wealth
counselor. Keith Whittaker, managing director and head of Calibre’s Family Dynamics unit,
(continued on page 11)
Check www.iiwealthmanagement.com during the week for breaking news and updates.
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Private Asset Management
Page 2
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February 9, 2009
At Press Time
Barclays Wealth Exec Joins Bessemer
Holly Isdale, former managing director for Barclays Wealth who left the firm
last month, has joined Bessemer Trust. Isdale steps into the newly-created
role of deputy head of Family Wealth Advisory Services, reporting to William
Forsyth, senior fiduciary counsel.
New York-based Isdale is responsible for the development of wealth advisory
services and family wealth management for the firm’s ultra-high-net-worth clients.
She also specializes in legacy planning, according to a spokeswoman. Calls to
Isdale were referred to the spokeswoman.
A Barclays spokeswoman said there are no replacement plans for Isdale, who
joined Lehman Brothers in 2004 and stayed on briefly after the acquisition.
Nuveen Jumps Into Alternatives
Nuveen Investments is planning to enter the hedge fund space and readying a
global endowment model for high-net worth and institutional clients. Nuveen
created Nuveen Alternative Investments at the end of last year to bolster its
presence in alternative investing, and these will be the first offerings from the
firm, headed by Mark Anson, president, and Jamshaud Zovein, managing
director. The fund of hedge funds and global endowment model have been
designated priorities for Nuveen and both are expected to launch this year, with a
target of mid-year, said Zovein. The global endowment model will be based on
the investment models of large educational institutions and will be targeted at
high-net-worth clients and institutional investors.
Former Wachovia President Named To
Regional Post
Wells Fargo, which recently acquired Wachovia, has named Stan Kelly, former
president of Wachovia Wealth Management, regional president for North and
South Carolina. Kelly, who has spent 28 years with Wachovia, now reports to Laura
Schulte, head of Wells Wachovia’s Eastern Community Banking in Charlotte.
Jay Welker, former head of the Wells Fargo Wealth Management Group, was
named president of the combined Wealth Management Group in December
following the Wells acquisition (PAM, 12/29). Kelly will be based in Charlotte
and Winston-Salem, N.C. and lead the retail, small-business and banking
operations for Wells Fargo in the region, which includes the Raleigh-Durham
area, according to an internal memo. Calls to Kelly were not returned. A
spokesman said that Kelly pursued this position after spending most of his early
career working in the Carolinas.
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Firms & Services
N.J. Firm Names Merrill Tax Pro COO
Pennington, N.J.-based Prestige Wealth
Management Group has tapped Thomas
McCabe from Merrill Lynch Trust as coo of
its wealth management group. McCabe will
also take the post of director of accounting for
Prestige’s Wealth Accounting Group. Roy
Williams, founding partner, said Prestige
Thomas McCabe
previously employed a part-time accounting
professional and is now looking to better integrate wealth
management and accounting services. McCabe, who was referred
to Prestige through a mutual friend, told PAM he was attracted
to the firm’s effort towards taking a proactive
approach to tax planning for its clients. “Just
looking at the need that clients are going to
have considering the volatility in the markets
and the new tax laws, they are going to need
planners and CPAs more than ever,” he said.
At Merrill, McCabe was v.p. and chief
Roy Williams
administrative officer where he led a
fiduciary investment oversight team for the high-net-worth.
Prestige Wealth Management, which provides investment
management services to HNW individuals, families and
corporate executives, oversees more than $400 million in assets.
Private Asset Management
another vehicle that can be used to house proceeds of an asset sale.
“The difference between the two [vehicles] is with the CRAT, the
annual annuity stays the same for the term of the trust. With a
CRUT the trust gets revalued every year as of the first of the year,”
said Bekas, adding that a CRUT is more of a gamble since the
annual income level is not fixed and tied to stock prices.
Wachovia Trust Exec Heads
To Glenmede
Frederick Young, regional managing director of the Atlantic
region for Wachovia Trust, a unit of Wachovia Wealth
Management, has left to join Glenmede Trust.
In his new role at Glenmede’s Princeton office, Young will
oversee sales and new business, and offer financial planning
advice for high-net-worth clients. Calls to Young were referred to
a Glenmede spokeswoman who would only confirm his hire.
Glenmede launched an ongoing national marketing campaign
last fall to tout its strength and stability in the midst of the
market downturn (PAM, 12/1).
While at Wachovia, Summit, N.J.-based Young oversaw a
team of 30 trust advisors in New York, New Jersey and
Connecticut. A Wachovia spokesman said there were no plans
for replacement.
White Paper Says CRUTs Provide
New Estate Option
Hands-On Philanthropic
Endeavour Launches
A Charitable Remainder Unitrust (CRUT) is
a useful tax vehicle for the high-net-worth to
house proceeds from the sale of valuable
collectibles, according to the white paper
Charitable Remainder Unitrusts: A MustConsider Wealth Maximization Vehicle For
Owners Of Hard Assets.
Michael Bekas
Michael Bekas, author of the white paper
and tax partner at accounting firm Marks Paneth & Shron, told
PAM the CRUT would house the proceeds from the sale and
generate income to be reinvested—and the interest earned would
eventually go to a charity. “Using a Charitable Remainder Trust
has created a cash flow that I would not have had before,” said
Bekas. Bekas said if a portion of the proceeds is then used to
purchase a life insurance policy, this can be housed in a Life
Insurance Trust with the heirs as beneficiaries. The monies
received by the beneficiaries would be free from estate tax,
according to the white paper.
Bekas said a Charitable Remainder Annuity Trust (CRAT) is
Maryann Fernandez, president and cofounder of the Manhattan-based foundation
Shaking The Tree, will launch a hands-on
philanthropic firm that offers travel and
internships for high-net-worth individuals
and families. The New York-based firm, called
Philanthropy Indaba, will work with family
Maryann Fernandez
offices and private banks to offer this service
to clients to provide a bird’s eye view of charitable giving options.
Fernandez told PAM the firm, which will launch by the end of
the month, will meet with individual clients to evaluate what
type of organizations they want to support, where they’d like to
travel to, and the type of experiences they want to have as it
relates to philanthropic endeavors. Philanthropy Indaba will then
customize a trip for that particular person or family and speak
with them afterwards about their experiences and other options
for continued giving.
Fernandez said that, despite the downturn in the economy
and giving, philanthropic-minded clients want more than ever to
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February 9, 2009
Firms & Services (cont’d)
see where their money is going, and how they can make a
difference through more than just check-writing. It will market
itself through word of mouth, client referrals, and its Web site
(www.philanthropyindaba.com). The firm, which took the name
“Indaba” from a Zulu word meaning a discussion between people
of different tribes, is also organizing service internships that are
matched with a monetary donation from the client and geared
for the younger generation and retirees. Fernandez is currently
crafting an internship where one client will work with an Oscar
Award winning director who is shooting a documentary about
poverty in Africa.
Fernandez plans to donate 10% of the firm’s yearly profits to a
new charity each year. She said she continues to work with
Shaking The Tree, which uses theater and other mediums to
provoke discussions among wealthy families, and is currently
working on a script for its next production.
Darcy Bhatia, partner with multi-family office Highmount
Capital who plans to work with Philanthropy Indaba, said
“Maryann’s guidance complements our own work with families
and the next generation. It is great for the young adults going
through our program, especially those who are experiencing
tough times in this job market and need to have a life changing
experience,” said Bhatia.
Northern Trust Ponders Investment
Biz Consolidation
Northern Trust Global Investments is considering combining its
London-based and U.S.-based manager of managers business,
Northern Trust Global Advisors, under one roof. It already plans
to consolidate its North American index management business in
Chicago and will be moving its passive investment management
teams in New York to the Chicago headquarters.
“By consolidating quantitative portfolio management in single
centers located in Chicago and London, we will be able to meet
client needs across North America, EMEA and APAC with
focused investment teams that operate efficiently,” according to a
client letter. It is so far unclear what impact the moves will have
on staffing. The parent firm announced at the end of last year
that it plans to axe about 450 employees globally.
Northern Trust has about $235 billion in assets under
management, of which more than half is already overseen by
investment professionals in Chicago. The firm has also combined
its active equity strategies under the leadership of John Cole, who
was previously the head of active growth equity. He did not
return a call by press time. The groups were combined in
December, and the move has not resulted in staff cuts yet,
though some are expected, a firm official said.
4
Merrill PBIG Nabs $2B
Big Apple Team
Merrill Lynch’s Private Banking and Investment Group has
scooped up the approximately $2 billion team of Eric Bodner
and Benjamin Sax from UBS Private Wealth Management in
Manhattan. The nine-person team led by Bodner and Sax join
Merrill’s PBIG at 2 World Financial Center in N.Y. and report to
Riley Etheridge, regional managing director.
“We decided to move because we felt that the platform here to
execute our business was better, and it is,” Bodner told PAM.
Bodner would not comment on compensation.
The team specializes in trust and estates, tax consulting, cash
flow analysis, concentrated equity, options and restrictions.
Merrill’s PBIG handles high-net-worth clients with $10 million
or more in investable assets. A UBS spokesman would only
confirm the departure.
SG Adds To Swiss Hub
SG Private Banking has brought on Guillaume Lejoindre,
former director for private banking clients at Credit Agricole, as
managing director of SG in Switzerland.
Zurich-based Lejoindre steps into the new post to
accommodate growth and expansion plans for SG’s efforts in
Switzerland, which has increased because of new business growth
from the firm’s merger with Geneva-based CBG Compagnie
Bancaire Geneve. Calls to Lejoindre were referred to a spokesman.
SG, the wealth management arm of Societe Generale, has €73
billion in assets under management, and works with international
family office clients and wealthy individuals through its global
alliance with Rockefeller & Co.
Greycourt Hires For Top Tier
Wealth management firm Greycourt has named Gregory
Friedman, its current cio, as president and appointed Gretchen
Shoup as coo.
Friedman, who will retain his cio role, steps into the newlycreated post to accommodate the Pittsburgh-based wealth
management firm’s growth plans. The firm works with high-networth families throughout the U.S., and has recently launched
offices in Charlotte, Houston and Portland, Ore.
Shoup, a managing director overseeing operations and
client services, steps into the new role of coo, which was
being overseen by David Lovejoy as part of his cfo and chief
compliance officer positions. The pair report to chairman
and founder Greg Curtis. Calls to Friedman and Shoup were
referred to a spokeswoman.
©Institutional Investor News 2009. Reproduction requires publisher’s prior permission.
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Krawcheck, Research Firm Host
Book Launch
Sallie Krawcheck, former ceo of Citigroup
Global Wealth Management, and the political
research and advisory firm The Eurasia
Group, will co-host a gathering for the launch
of the book The Fat Tail: The Power of Political
Knowledge for Strategic Investing.
The event will invite Citi clients and
Sallie Krawcheck
friends of both Krawcheck and the book’s
co-authors, Ian Bremmer and Preston Keat. Krawcheck will
introduce the authors, who will discuss how politics and
business fuse and how investors should identify and manage
political risks. The evening reception, slated for Feb. 24 at The
Yale Club, will invite roughly 200 guests, according to a
Eurasia spokeswoman.
Krawcheck, who left Citi in September reportedly after turning
down a client advisory position offered to her by Citi chief
executive Vikrim Pandit (PAM, 9/23), could not be reached.
Family Office
FoF Specialist Leaves Safra
Family Office
Mark Raskopf has left his role as managing director at Safra
Bank’s family office, M. Safra & Co., where he headed up all
hedge fund research. An official there declined to comment on
replacement plans, if any, and Raskopf did not return a call.
Before joining M. Safra in January 2005, Raskopf was a
director in the fund of hedge funds business at Bank of America
for three years, and before that, a portfolio manager at Deutsche
Asset Management, also focusing on its funds of funds.
Shelterwood Adds To Team For
New Biz
Multi-family office Shelterwood Financial Services has brought
on Dimitri Balatsos as senior advisor in charge of new business
growth. Balatsos will bring his background as founder of global
investment management firm Tesseract Partners where he
worked with U.S. and international clients. The Manhattanbased MFO is looking to bolster its ultra-high-net-worth client
base, particularly in London, major European hubs and
throughout the U.S., and Balatsos was brought on to help with
this growth. Balatsos, who will continue in an advisory role with
his former firm, will also focus on multi-generational investment
planning for family business owners. “Shelterwood understand to
its core that wealth management means more than just managing
Private Asset Management
assets,” he said.
Shelterwood, founded in 2004 as a subsidiary of family
business J.M. Huber, focuses on investment management,
succession planning and tax and estate planning.
Silver Bridge Hosts
Philanthropic Session
Multi-family office Silver Bridge Advisors
held a workshop on strategic philanthropy, as
part of the launch of its monthly Women’s
Initiative series.
The workshop, held Jan. 27 at the Bostonbased firm’s headquarters, focused on
philanthropic trends and giving during
Steve Prostano
recessionary times, an economic overview and
breakout sessions on how to create a giving plan. Steve Prostano,
ceo, said the goal was for participants to come away with a
personal mission statement for charitable giving.
Advisory firm speakers included Janet Atkins, principal of
Ridgeway Advisors, Anne Ellinger, co-founder of Bolder Giving
and Abbie von Schlegell, principal of A. von Schlegell & Co.
who led the sessions and discussion groups. Michelle Knight,
director of fixed income with the MFO, also participated in the
session, which is part of the firm’s monthly series Women’s
Initiative: Enrich, Engage, Enjoy. Costs could not be determined.
Highmount Grows Staff
Multi-family office Highmount Capital has
brought on two senior executives in New York
and Boston, its headquarters, and is
aggressively looking to hire more executives in
those cities, said Darcy Bhatia, partner.
Highmount hired David Thompson,
former managing director with North
Darcy Bhatia
American Management, as managing director
of fixed income. The position was created to emphasize fixed
income investment opportunities at the firm, said Bhatia.
Additionally, Nancy Brickley was brought on in Boston as
managing director to focus on business development. Brickley,
former managing principal with North American Management,
is also responsible for marketing and client sourcing efforts.
For additional hires, Bhatia said the firm is targeting those
who have recently left big banks and are looking for a boutique
atmosphere. “We’re also looking for good people to join us in
both New York and Boston who might be displaced from all the
big banks merging,” said Bhatia, declining to provide a target of
how many more the firm will add.
Highmount has $1.3 billion in assets under management.
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Family Office (cont’d)
Tag Associates Taps Tax Pro
New York-based multi-family office Tag Associates has hired
Stephen Cutting, former owner and president of Albany-based
MFO SMC Advisory, for a newly-created post of director of tax
services. David Basner, president and coo, said Cutting was
brought on to review tax work and compliance for family office
clients, adding he hopes to evolve the role into a managing
director post for client advisory.
Cutting, who reports to Clara Wong, managing director, said
he decided to leave SMC Advisory and move to Manhattan for
personal reasons. “I wanted to be part of a boutique firm with
high-quality MFO services,” Cutting added, declining to
comment on replacement plans for his old post.
Tag Associates caters to families with $20 million and above
providing investment, financial and tax planning, compliance
and controllership services. Tag has $5 billion in assets under
management. David Glaser and Gary Teigman with search firm
ECG Resources conducted the search.
Research
Unhappy HNW Investors
Moved Assets
More than half of wealthy investors who
planned to withdraw assets from their advisory
firms in September, immediately following the
fall of Lehman Brothers, have done so,
according to a Prince & Associates study. The
study, a follow-up to an investor behavior
study conducted in September, found that
Hannah Shaw Grove
48.2% took assets from their primary advisor
out of the 80.6% of high-net-worth who said they would do this.
They in turn invested these assets with other advisors.
Hannah Shaw Grove, managing partner at Prince &
Associates, told PAM the prolonged nature of the economic crisis
prompted investors to make these changes. “A number of
investors cited the idea of diversifying their relationships so they
had less risk of having their advisor become unemployed or firm
go bankrupt,” said Grove. She added, “For the first time in a
long time people are concerned about having all of their assets in
a single relationship because so many companies are failing and
requiring government support.”
Grove said the biggest disparity between last fall’s results and
the new study is how participants responded to and then acted
on their intent to recommend avoiding their advisor’s firm. Last
fall, 85.7% of participants said they would recommend avoiding
their advisor’s firm, while just 14.9% of those investors acted on
Private Asset Management
Bessemer Hires Business
Development Officer
Bessemer Trust has tapped Gilbert Chapman,
principal with Bernstein Global Wealth
Management, in the new role of business
development officer. New York-based Chapman
reports to Andrew Parker, managing director.
Chapman, a 25-year industry veteran, was
brought
on to work with high-net-worth
Gilbert Chapman
families in Long Island and build investment
strategies, as well as bring in new business, said a spokesman.
Calls to Chapman were referred to the spokesman. Calls to
Bernstein GWM regarding replacement plans were not returned.
Bessemer Trust has more than $53.8 billion in assets under
advisement for approximately 1,900 family relationships. It
provides various investment, tax, legacy planning and
philanthropic services.
that intention.
Grove said many investors who have left an advisor or took
some assets out are now taking a long-term view, and holding off
on making more changes until they see the results of their move.
The study is based on telephone interviews with 228 investors
with $1 million and above, and Grove expects to do a follow-up
later this year.
Real Estate Favorable With
Younger Rich
Younger high-net-worth investors—those ages 25 to 45 with $1
million or more in net worth—are more likely to invest in
real estate in the future compared to their older counterparts.
In the Spectrem Group group’s January newsletter, Millionaire
Corner, 34% of younger wealthy investors said they still
consider real estate a good investment while just 17% of all
wealthy investors said they look at real estate as a solid
investment and plan to invest in the future.
“For a lot of these people, real estate feels safe and that is
because they see it as a long term investment and not a short
term,” said Cathy McBreen, managing director of Spectrem’s
consulting and research divisions. She said real estate is appealing
to younger investors because of its attractive price levels and is
also a way to pass on intergenerational wealth.
McBreen said real estate generally increases in value even though
it has taken a large hit as of late. She added that wealthy investors
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February 9, 2009
Research (cont’d)
are buying “income producing real estate,” which is made up of
office buildings or rental properties, and are staying away from
investing in vacation areas or vacation-type homes of late. The study
is based on interviews with focus groups and an online study of 750
millionaires—those with more than $1 million of net worth—in
New York, Palm Beach, Seattle, Los Angeles and Chicago.
Problem? What Problem…
Advisors Missing The Mark
On HNW Fears
The high-net-worth advisor is underestimating
how severely market volatility is affecting their
clients’ attitudes, according to a Phoenix
Companies survey Taking The Temperature of
Today’s HNW Consumers And Advisors. Walter
Zultowski, senior v.p. of research and concept
development, told PAM that the study found
Cathy McBreen
the wealthy are consistently more bearish on
the economy and its prospects for sustainable growth than their
advisors. He said the disconnect could be
caused by advisors having more experience
with a bad economy and being more
hopeful that it will bounce back.
Zultowski said 71% of HNW
consumers cited that they are more or
much more concerned about their
lifestyle changing, while 65% of
advisors cited the same.
When HNW consumers who are within five years of
retirement were asked whether their retirement plans have
changed, 30% said they are changing their retirement plans while
another 38% said they have not yet changed their plans but are
thinking about retiring later. “Concern over retirement security
has just been aggravated even more so now, and maybe it’s
actually starting to play into the HNW’s behavior such that a
third of these people are saying ‘yes I’m going to have to work
later now,’” said Zultowski.
The survey queried 200 HNW clients and 200 HNW
advisors in November.
PAM020909
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4:43 PM
February 9, 2009
Page 9
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Private Asset Management
On The Move
• Credit Suisse Private Bank USA has tapped Jonathan Torop
from Goldman Sachs Private Wealth Management. New Yorkbased Torop spent 10 years with Goldman, where he focused on
high-net-worth U.S. clients with Middle Eastern ties.
•
Baird has hired David DiStefano from Virchow Krause, an
accounting and consulting firm, for its Janesville, Wisc. branch.
DiStefano joins The Greene Group at Baird, which includes
financial advisors Derek Greene and Debra Cerny.
• RBC Wealth Management has nabbed the Petrucci Team
from UBS Wealth Management in Minneapolis. The team,
led by financial advisor Gary Petrucci, joins with more than
$300 million in assets under management. Other associates
include Lory Dubbels and Deb Stueven. RBC WM has also
tapped the team of Bill Hedges, Lance Newlin and Shelley
Johnson also from UBS for its Reno hub. They join with
$200 million in AUM.
•
UBS Wealth Management has hired Maynard and Sally Engel
from Merrill Lynch in New York for its Midtown office. The
team joins with $187 million in AUM. UBS also tapped John
Lucas from Credit Suisse Private Bank in San Francisco. Lucas
joins with $150 million in AUM.
• Levitt Capital Management, a Boca Raton, Fla.-based
boutique wealth manager, has brought on David Alexander
Jefferds as the managing director of investments from Vanquish
Capital Group. Jefferds replaces Warren Buhai, who is slated to
return to his native South Africa, in the post.
• Barclays Wealth has hired Adam Shafiroff from RBC Wealth
Management as director for its New York office. Shafiroff works
with high-net-worth clients with more than $10 million in
investable assets.
• Merrill Lynch’s Global Wealth Management Group has
snagged Smith Barney advisors Peter Jurasz, Doug Scudder
and Brian Lingle for its Juneau hub. The team joins with $350
million in AUM and caters to clients who are primarily
entrepreneurs in the Juneau, Anchorage and Seattle areas, Jurasz
told PAM.
Wealth Management Happenings
• High Water Women will host its fourth
• Family Wealth Alliance will host its inaugural 40 Minus
annual Casino Night Gala April 2. The
volunteer organization, comprised of women
in the hedge fund and wealth management
industry, will donate proceeds from the event to at-risk New York
City women and children. The event, to be held at 7W New
York in Midtown, will feature a Black Jack tournament, Craps
table, sit-down dinner and cocktail reception.
Leadership Summit from March 4-5. The event will
acknowledge executives who are 40 years old or under and
have made significant contributions to the wealth
management space, and shown leadership in the challenging
market. It will be held at the State Street headquarters in
Boston.
• Irvine, Calif.-based Prosperitas, a high-net-worth peer group,
family business and succession planning in the current economy.
Partner Mitchell Kops will host the session, Finding the Silver
Lining: Opportunities in a Challenging Economy, to discuss
liquidity options, succession planning and structuring, and
opportunities for devaluation in family businesses for tax and
succession planning. Clients can attend either the Feb. 25 or
March 4 session, which will be held at the Hyatt Regency
Greenwich and Withers’ Manhattan office, respectively. The law
firm is partnering with family business advisory firm de Visscher
& Co. for the sessions.
will hold its first annual economic summit, Wake Up America!,
February 19. The summit, which is slated to take place at UC
Irvine, will focus on thriving and surviving in 2009 and agenda
topics include how to navigate current economic events, meeting
the China Challenge and a viewing and discussion of the film
I.O.U.S.A. about the national debt.
• The ABA Wealth Management and Trust Conference is slated to
take place March 11-13 at the San Francisco Marriott. The annual
conference, hosted by the American Bankers Association, is geared
toward financial advisors, portfolio managers, and trust and estate
planning attorneys. Agenda topics include nurturing client
resilience in the face of turbulent markets, how unified managed
accounts are changing wealth management and estate planning for
the Lesbian Gay Bisexual and Transgender community.
• Withers Bergman will host a session dedicated to managing a
[Editor’s Note: Beginning with this issue, PAM will feature a Wealth
Management Happenings section which will include a wrap-up of
events, conferences and receptions. Please feel free to submit your
event to Marianne Nardone, managing editor of PAM, at
[email protected].]
To receive email alerts or online access, call 800-715-9195.
9
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2/7/08
3:40 PM
Page 1
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Private Asset Management –
Critical Intelligence for the High Net-Worth Arena
PAM020909
2/5/09
4:43 PM
Page 11
February 9, 2009
www.iiwealthmanagement.com
BOFA, UST
(continued from page 1)
report to Gary Gore, head of the Richmond office. On the West
coast, the Los Angeles office has also been whacked as a hub, but
the office remains open. There was talk it would report into
Century City, but that could not be confirmed.
On the family office side, the firm is looking at how best to
combine BofA, UST’s MFO, and Merrill’s FOS division. Merrill
pulled back on plans to launch a full-blown multi-family office
after the acquisition was announced (PAM, 11/3). Firm officials
either declined to elaborate or could not be reached.
—Kristen Oliveri
LAW FIRMS
(continued from page 1)
tight-knit market with a well-known name. The firm then
launched a family office division at the start of the year.
Boston area law firms Choate Hall & Stewart and Mintz
Levin have rolled out Choate Investment Advisory and
Mintz Levin Financial Advisors, respectively, to cater to highnet-worth in the area, although specifics could not be
determined. Boston law firm Ropes & Gray is also reportedly
in the early stages of starting a family office. Calls to Todd
Milay, head of Choate Investment Advisory, and Cary Geller,
an advisor with Mintz Levin FA, were not returned by press
time. A spokeswoman for Ropes & Gray did not return calls.
The New England wealth management market is tough to
break into, but well-established, large law firms are using existing
client bases and their reputation to attract clients, said Roger
Private Asset Management
Hobby, head of Wilmington Trust Boston. These law firms can
compete with larger banks through their existing estate, trust and
succession planning services. To staff the new efforts, there is a
surplus of wealth management professionals available for hire,
following downsizing at larger firms in the area. The ability for
law firms to act as trustees originally grew out of the whaling
industry, when whalers at sea for years asked their attorneys to
oversee investments as well as their legal affairs.
—Marianne Nardone
FIRMS, FAMILY
(continued from page 1)
and Susan Massenzio, who works with Whittaker as a counselor,
told PAM they have been speaking more frequently on trustbuilding through Webinars and other forums for private bankers
and advisors. Whittaker said families want more attention on the
human aspect of living with or losing wealth, and legal and
financial disciplines often cannot provide this.
Wells Fargo’s multi-family office, The Family Wealth Group,
recently employed two wealth counselors for both their
relationship managers and family office clients. Calls to
relationship managers Jamie Traeger-Muney and Rebecca Trobe
with Wells were referred to a spokeswoman who did not
respond by press time.
One wealth management firm that has signed on for service
agreements with independent wealth counselor Szifra Birke, a
licensed therapist and president of Birke Consulting, is
Lexington Wealth Management. Kristine Porcaro, coo and cofounder, said especially in these times, wealth counseling for
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PAM020909
2/5/09
4:43 PM
Page 12
Private Asset Management
www.iiwealthmanagement.com
clients has played a strategic role in deepening client relationships
and providing a more open discourse.
Jim Grubman, a clinical psychologist and head of
Massachusetts-based FamilyWealth Consulting, said he has seen
a 20% increase in referrals since the fall from clients and wealth
management firms who manage at least $25 million in assets.
Most of the counseling of late surrounds working with advisors
who are burned out, exhausted and considering leaving the field
HEIDI NEDWURTH’S
NOTES
Citi’s High-Flying Plans Leave
Heidi Cold
The rough ride in the economy has halted Citigroup
from enjoying their ride—make that a near purchase
of a French luxury jet—with the firm scrapping plans
to purchase a $50 million Dassault Falcon 7x. The
corporate jet is designed to hold eight passengers plus
a crew of four, boasts hand-selected, custom-crafted
interior furnishings and can fly 5,950 miles without
refueling. But before Citi executives could try out the
luxurious digs many legislators and even President
Obama publicly chastised the former banking
behemoth for considering the jet after it accepted $45
billion in government funding.
Heidi thinks Citi big-wigs should look to more
grounded venues to get their luxury on. It has been
reported that the wealthy in Abu Dhabi are enjoying
rose champagne, chocolate cake and cappuccinos all
flaked in gold while the wealthy in Russia prefer their
gold to be eaten with caviar and oysters. On the
ground, these golden delicacies would set you back
about $3K for a three-liter bottle of the rose
champagne, according to reports.
Maybe former Wall Street titans, such as those
sugar-daddies who recently attended the everpopular Fashion Meets Finance party at the Empire
Hotel in Midtown, can impress their less wealthy
sweethearts with Heidi’s favorite: the extremely
valuable and edible gold leaf for a mere $15K a
pound. The wealthy fat cats could also follow
ousted Merrill Lynch ceo John Thain’s lead and
drop a cool $1.2 million on, amongst other things,
a trash can, area rug, mahogany table, curtains and
a “commode on legs”—all must haves in any plush
office including Heidi’s!
12
February 9, 2009
because of portfolio losses and client reaction to the Bernard L.
Madoff Investment Securities fallout.
Unlike the peer support groups that have sprung up among
investors who were burned by Madoff, wealth counselors are
providing private, professional services for clients and typically
charge an hourly or per diem rate for consultations. Gary Shunk,
a licensed psychotherapist and head of Chicago-based Wealth
Psychology, and Birke both reported a 50% increase in client
referrals and inquiries since last fall.
—Melissa Karsh
Quote Of The Week
“A number of investors cited the idea of diversifying their relationships
so they had less risk of having their advisor become unemployed or firm
go bankrupt.”—Hannah Shaw Grove, managing partner at Prince
& Associates, responding to the firm’s study which found that more than
half of wealthy clients who planned to would withdraw assets from their
advisory firm actually did so (see story, page 7).
One Year Ago In Private Asset Management
•
Jennifer Povlitz, head of the Eastern division for Merrill
Lynch’s Private Banking and Investment Group, left the firm to
relocate to Newport Beach, Calif. [Povlitz originally took a role
as managing director and head of the wealth management group
for San Francisco-based Presidio Financial Partners (PAM,
2/21). Povlitz later decided to stay with Merrill Lynch, accepting
a post as regional managing director for Northern California
(PAM, 4/4).]
• New York Private Bank and Trust expanded its Manhattan-
based hub and launched offices throughout the U.S. It expanded
its platform to offer a fee-based outsourcing service to firms who
were looking to expand their private banking capabilities.
Five Years Ago
• Northern Trust Global Advisors hired Chris Vella from
Goldman Sachs’ Global Multi-Manager Strategies group to run
equity and fixed-income manager and due diligence selection.
[Keith Ardizzone and John Voltaggio, former managing directors
with U.S. Trust’s multi-family office in N.Y., joined Northern as
relationship managers as part of the firm’s expansion plans in the
Chicago area (PAM, 1/26).]
• Family offices were making a push into hedge fund
management, following predications that the number of singleand multi-family offices managing hedge fund of funds was
projected to double within three years, according to a Prince &
Associates family office survey.
©Institutional Investor News 2009. Reproduction requires publisher’s prior permission.