HOLLYWOOD, FLA. – The shortage of advisors can easily turn into a crisis if the problem is left unaddressed.

That was the consensus of a panel that spoke here at BISA’s annual convention. “I think it’s a slow-moving crisis. We have time to address it,” panel moderator Paul Werlin, president of Human Capital Resources, told a room packed with advisors.


Three of the panelists refrained from calling the problem a crisis just yet. “I think ‘crisis’ is a little too strong of a word,” said Frank Smith, vice president of Advisor Recruiting at LPL Financial Institutions. Timothy Sease, president and CEO of First Southeast Investor Services, echoed the same view, saying that the issue was nearing—but not quite at—“a tipping point.”

But Kevin Carreno, president of Experts Counsel who is serving a three-year term on FINRA’s board, was more pessimistic. “I can tell you undoubtedly that we are in a crisis,” he said. “If we stick to traditional models, we’re going to be out of business.”


Carreno noted that FINRA is losing about two and a half member firms a week, firms that are the “most fertile development grounds” for new advisors.

While the panelists differed in their views regarding the severity of the problem, they all agreed that action was needed and were dealing with it in different ways.

Frank Consalo, director of sales at Citi Personal Wealth Management, said that sales and program managers should continually contend with the challenge of recruiting. “Recruiting isn’t something you do when you have nobody. It’s something to do every single day,” he said.


Citi and First Southeast are trying to tackle the boomer-advisor issue, with a large wave of advisors expected to retire in the next 10 years.

According to Consalo, Citi is working on a “sunset program” for advisors in their late fifties who would like to monetize their books of business. Rather than lose older advisors who could easily “go across the street” and take a huge chunk of their AUM with them for a sizable payout, Citi would much prefer to keep the business. He said Citi is pairing older advisors with younger ones to ensure a smooth transition of the business.

On this front, First Southeast seems to be ahead of the curve, having already implemented a “succession planning solution,” said Sease. It involves giving the advisor a small base salary for three years and splitting revenue with a junior advisor.

Working with FINRA to relax regulations that would help bring highly-qualified individuals into the industry was another solution discussed. For example, FINRA is kicking around a proposal that would allow someone to come into the business already licensed. Typically aspiring advisors need to work with a firm and gain experience before taking the licensing exam.

“We need to find ways to facilitate the entry of new talent into the business,” said Carreno. “Odds are high,” he said, that FINRA’s proposal “will be done in the next two years.”

Read more:

Register or login for access to this item and much more

All Bank Investment Consultant content is archived after seven days.

Community members receive:
  • All recent and archived articles
  • Conference offers and updates
  • A full menu of enewsletter options
  • Web seminars, white papers, ebooks

Don't have an account? Register for Free Unlimited Access