Louis Diamond Quoted
By Alex Padalka
The Department of Labor’s guidance on the fiduciary rule has caused Morgan Stanley to do away with the back-end part of broker recruitment packages, the Wall Street Journal reports. The move, which may be followed by other large brokerages, could drastically reduce the size of recruitment offers for experienced advisors, according to the paper.
Cutting out back-end portions of recruitment packages could help brokerages reduce costs but brokers are likely to suffer as a result, Louis Diamond, vice president of broker recruitment company Diamond Consultants, tells the paper. On the other hand, he says, companies may raise salaries to lure brokers to compensate for the loss of back-end deals, since salaries wouldn’t raise issues under the DOL rule.
