| NEW YORK
NEW YORK Aug 16 Many financial advisers accept
that their clients work with multiple advisers - that's
particularly true of the ultra wealthy, who often like to spread
their money around.
Only about one of every three clients turns over all of
their assets to one wealth manager, according to a survey of
about 400 advisers from research firm Aite Group. Not all
advisers are willing to accept a lack of loyalty.
Adviser Art Husami, owner of Santa Fe Springs,
California-based Husami and Associates, requires - with some
small exceptions - that his 50 wealth management clients
foresake all others to work with him. If a client takes on a
second adviser for no good reason (good reasons include
maintaining a relationship with a bank or helping out a family
member who is an adviser), he fires them - though he's only
actually done that twice.
The idea of pruning a book is not new. Advisers routinely
weed out clients who are rude to staff or require too much work
relative to the size of their accounts.
Husami's approach is unusual in that he is taking that
strategy to an extreme, said Sophie Schmitt, an analyst with
Husami says his one-adviser policy is not about arm
twisting, deadlines or ultimatums. Instead he thinks this is the
best way he can serve clients.
It comes down to being able to easily see where all their
assets are and making enough of a fee so that he feels he can
unconditionally spend time with them - even on things questions
like whether they should buy or lease a car.
Most important, it helps him know that his clients are happy
- if they wanted to keep some of their money elsewhere, he would
have to question if he was failing them in some way.
Husami puts a lot of effort into screening potential
clients, and only signs on people who like the idea of his
monogamy model. They do not have to initially give him all their
money to manage, but he expects them to eventually.
This all-or-nothing policy may sound audacious to some,
since many clients like having different advisers for different
So we asked Husami to describe how client monogamy works for
TAKING A STAND
Husami, 65, manages about $350 million in client assets for
a set fee ranging from 0.5 percent to 1.3 percent of assets
For that fee, he manages their investments but also gives
them advice on issues like wealth transfer between generations,
taxes and business ownership. He also gets commissions on
certain large transactions, like annuity purchases, and he gets
particularly upset when his clients take that business
About a decade ago Husami, who has been in the financial
services industry since the mid-1990s, realized that the best
relationships he had were with clients who had complex needs and
let him manage all their money.
These clients, who typically owned one or more businesses
and had multi-generational planning issues, let Husami delve
into their financial lives.
So he gradually weeded out the clients who kept investments
elsewhere and he focused on working with business owners.
About six years ago, a family who had roughly $200,000
invested with him went shopping elsewhere when they wanted to
buy an annuity - typically a high commission product.
Husami got frustrated because he gives a lot of
complimentary services to clients, like tax advising, in the
expectation that they will turn to him when they buy investment
products that confer sizeable commissions. He explained that to
the clients, but soon after, they went elsewhere for a life
At that point he told the family he didn't think he could
give them the time they deserved, and they parted ways amicably.
His other pet peeve is when clients want to use a second
adviser to pit their investment returns against his.
"What are you testing me for? I cannot time the market," he
Husami is not so extreme as to say his clients cannot talk
to other advisers. But if they do, he wants to know why, so he
can address their concerns.
Phil Wood, president and chief executive officer of
Omaha-based One Price Portfolio, says that in a perfect world,
all of his clients would give him full authority of their money.
In reality, Wood thinks it is better to give clients more
"Why close the door on someone who can be a great client
five to ten years from now?" he said.
Ryan Wibberley, chairman and chief executive officer of CIC
Wealth Management in Gaithersburg, Maryland, is similar to
Husami in that nearly all of his 125 clients give him all their
investable assets to manage. Wibberley, however, does not draw a
line in the sand like Husami when it comes to clients consulting
"To be that disciplined and follow through is admirable,"
(Reporting By Jennifer Hoyt Cummings. Editing by Linda Stern,
Lauren Young and Andrew Hay)