August 18, 2020
Ira Shapiro, Mike Walker, and Al Lorenzi (left to right) joined LPL Financial-affiliated Stratos Wealth Partners with their two client associates Betsy Putz (second from left) and Deborah Perea (fourth from left) on August 13 in Scottsdale, Arizona.
Three independent brokers producing around $1.9 million at Wells Fargo Financial Network in Scottsdale, Arizona, changed jerseys on Thursday to join LPL Financial-affiliate Stratos Wealth Partners.
Allen B. Lorenzi, Michael J. Walker and Ira M. Shapiro, who had operated independently but worked out of the same FiNet office, have joined together as a single practice called Raintree Wealth Partners at Stratos. The trio, who moved with two client associates, had managed $375 million all-together at FiNet, Shapiro and Walker said in an interview about their move.
The three began considering a move about six months ago and expect to have more marketing freedom–including liberal use of social media–and higher pay at Stratos, according to Shapiro and Walker. They expect they can earn payouts in the upper 80% range with Stratos (before deducting their own operating expenses) while their compensation had dropped to 73% at Wells after recent pay changes.
“We had been enduring annual 1% to 2% pay cuts, but this year, because of a complete repricing of their platform, my pay went down by more than 15%,” said Walker, who had been with Wells for the past 15 years of his 36-year career, according to BrokerCheck.
The team had considered starting their own registered investment advisory firm or joining other independent broker-dealers but was persuaded to sign with Stratos in part by a longtime acquaintance and former Wells Fargo Advisors complex manager Bobbie Meola, who has been a managing partner at Stratos in Scottsdale since joining in 2013.
Stratos, which is based in Beachwood, OH, is one of LPL’s largest registered investment advisor affiliates with $14.3 billion in “assets serviced” according to its website. Advisors earn less by joining a hybrid RIA such as Stratos than if they affiliated directly with LPL but in exchange receive additional marketing and operational support.
Shapiro said they expect to have “newfound freedom” to market themselves on LinkedIn, Facebook, and Twitter with fewer compliance hurdles around social media use. The broker, who spent 22 years of his 28-year brokerage career with Wells and predecessor firms, also said the negative publicity associated with Well’s 2016 fake account scandal and subsequent series of headlines about regulatory issues in the consumer bank had not helped.
“It was a significantly tarnished reputation that I was constantly responding to customers’ questions about,” Shapiro said.
A Wells Fargo spokeswoman declined to comment on the move or on the team’s remarks.
LPL, the largest independent broker-dealer by headcount, had 16,973 independent brokers at the end of June, up by 812 from the prior year.
Wells Fargo said in its second-quarter earnings last month that its broker headcount among employee and independent advisors fell 4% from a year ago and 1% from the end of the first quarter to 13,298, a year-over-year net loss of 501 advisors. The decline came despite elevated signing bonuses Wells has been dangling to fill empty desks, but officials said the departures were largely due to advisor retirements and attrition of lower-end producers.
The bank-owned brokerage firm had 15,086 brokers on Sept. 30., 2016, the month before the fake account scandal was disclosed.
Lorenzi began his brokerage career with a stint at Cornell Securities in 1988 before quickly transitioning to Lehman Brothers in 1989. He joined Citigroup Smith Barney in 1993 and went independent with Finet in 2003, according to BrokerCheck.
Walker, who first registered as a rep in 1983 with Foster & Marshall/American Express, moved to Lehman Brothers in 1985 and Citigroup Smith Barney in 1993. He went independent via Finet in 2004, according to his BrokerCheck history.
Shapiro got his start with Dean Witter Reynolds in 1991 and joined Prudential Securities in 1996. He switched to A.G. Edwards & Sons in 2002 and successor Wells Fargo Advisors in 2008 before jumping to independence in 2010 with Finet, his BrokerCheck shows.