LPL Unveils Pure-Play Custodial Service for Fee-Only RIAs
June 8, 2021
By Diana Britton
While LPL Financial has custodied assets for registered investment advisors since 2008, it was largely to support the fledgling hybrid advisory business of its registered reps. But as it has across the industry, that advisory business has grown fast; according to Cerulli, LPL is now the third-largest RIA custodian in the marketplace.
So it makes some sense that since February 2019, LPL has been hinting at bringing a “more compelling and competitive offering” to fee-only RIAs, with no brokerage affiliation, signaling a profound evolution for the nation’s largest independent broker/dealer.
Now LPL is ready to take the more dedicated custody business to the marketplace, and WealthManagement.com got an exclusive on the details.
“The brokerage and regulatory construct that LPL grew up in over the course of 30-some-odd years doesn’t have the same impact and implications on those fee-only firms because it doesn’t have to,” said Marc Cohen, executive vice president of advisor business at LPL. With the new emphasis, “we really are purely serving as a custodian for them, as opposed to in the hybrid capacity we launched in ’08, where we were serving as both the custodian as well as a friendly broker/dealer, so to speak, in an integrated fashion.”