Former Fidelity rainmaker lands at Schwab after both big custodians reshuffle their East Coast staffing

Brooke’s Note: When we wrote about Fidelity Investments relinquishing the talents of Scott D’Alessandro, a number of sources expressed real surprise to me — saying that it just seemed to be a like a football team leaving a star player on the waiver wire. Sources imagined that D’Alessandro would be scooped up in short order — and so he has.

Scott D’Alessandro began his new job yesterday of heading up the sales effort for Schwab Advisor Services’ Northeast region after being squeezed out of a similar position at Fidelity in December. See: As Fidelity disassembles powerhouse sales team aimed at major RIAs a top talent departs.

The Boston-based executive will lead a team of eight business development officers covering a territory that stretches from Maine to Virginia — a megalopolis that contains a major swath of the wealth in the United States.

D’Alessandro takes a position last held by Thomas Cantillon, who now heads the relationship management team for the New York region. That position was open because Rich Policastro vacated it to become a senior managing director of all relationship management on the East Coast. Both those men are stationed in New York.

D’Alessandro was a legendary sales figure at Fidelity, heading up the group that handled sales to RIAs with $500 million or more of assets under management. He was said to have brought in as much as half the assets held by the custodian in his career there, which dated back to 1996. That position was eliminated in the aftermath of Fidelity going to a system of sales based on geographical location rather than size of practice.

Natural migration

Though the move from Fidelity to Schwab Advisor Services seems a natural one, some observers said the job is not without its potential disadvantages.

In some ways it’s easier to sell for TD Ameritrade or Pershing, the observers say. Schwab has already won a big market share and so those $700 billion-plus of assets are off limits to a Schwab salesperson. And the smaller custodians are sometimes more aggressive in supplying technology and low prices. See: The TD Ameritrade-Orion pairing again proves productive — this time to wrest assets from a $3.6 billion Schwab RIA.

Yet T.J. Gilsenan, principal with The Interactive Advisor, says that D’Alessandro made the right move in signing on with Schwab.

“Schwab’s not the leader for no good reason. They continue to innovate to attract new assets. Why wouldn’t you want to work for the leader?”

Gilsenan was also formerly on the sales staff of Schwab Institutional for 13 years and the Pershing RIA sales staff for almost four years.

Tim Oden, Schwab’s senior managing director of business development, says that his company is certainly pleased to have D’Alessandro come aboard.

“We’re glad to have Scott on board to help support our work with advisors in the Eastern region. Scott has a wealth of experience, and we think he’ll be a great member of the Schwab team.” See: Big advisors drive solid year for breakaway wins at Schwab, Fidelity, Pershing and TD.

Tim Oden: Scott has a wealth
of experience.

Appealing to the aggregators

One way that observers believe that D’Alessandro could help Schwab is in the one area where Fidelity has seemed to come out ahead — with the aggregators — particularly HighTower and United Capital Financial Advisers.

Gilsenan says there could be truth to that supposition.

“The real game is: who gets the money coming out of Morgan Stanley and Merrill Lynch. So I think that’s a very good move on [Schwab’s] part [in hiring D’Alessandro].”

Schwab holds more assets of advisors at Focus Financial Partners LLC than at other consolidators because more of Focus’ firms were existing RIAs that brought their Schwab custody relationships with them when they were purchased.

One possible short-term down side to the D’Alessandro hire, says an observer who asked not to be identified, is that he may be hindered by a Fidelity noncompete clause for Fidelity accounts for a period of time.

But the person adds that D’Alessandro is known to thrive on competition — a quality can sometimes get on the nerves of competing salespeople within the organization, the source adds.

Gilsenan says that that reputation for fierce competitiveness is a net positive.

“If you’re not making some people mad, you’re probably not doing your job.”