Wells Fargo continues to bolster its recruiting efforts with the addition of four Morgan Stanley advisors generating close to $5.6 million in annual revenue. The largest of the hires is Steven Esposito from Lake Forest, Illinois, who moved to Wells Fargo Advisors’ independent Financial Network channel. He managed $435 million in client assets and generated $2.8 million in annual production at Morgan. Esposito, a 39-year industry veteran, has worked at six firms, including Morgan Stanley for the past 14 years. Roni Murshad, a 20-year-industry veteran from Gaithersburg, Maryland, also made the move from Morgan to Wells FiNet. The advisor managed $79 million and generated $860,000 in annual production. Murshad, who began his career at Morgan Stanley in 2001, left after five years, and spent six years at Bank of America and Merrill Lynch, before returning to Morgan in 2012. In addition, two advisors from Westlake Village, California moved their team from Morgan to Wells Fargo. Howard Lee and Terri Lane managed $400 million and generated $2.1 million in annual production at Morgan. Lee started his career at Lehman Brothers in 1964, while Lane worked at six firms with stints at UBS and Bear Stearns, before joining Morgan Stanley.

Finsum:Wells Fargo bolsters its ranks with four Morgan Stanley advisors generating close to $5.6 million in annual production.

Asset managers and retirement plan advisers should be aware of how they are managing and presenting ESG funds. According to analysts at Fitch Ratings, recent regulatory actions are likely to continue into 2023. For instance, last week, Goldman Sachs paid the Securities and Exchange Commission $4 million to settle charges of failing to correctly incorporate ESG research into investment procedures and branding. In another example, on May 23, a BNY Mellon Investment Adviser paid a $1.5 million penalty for misstatements and omissions about ESG representation in mutual funds. In a press release on Tuesday, Fitch said “These types of charges are likely to continue as the SEC looks to crack down on greenwashing.” Fitch also noted that these types of charges can “lead to reputational damage that can weaken franchises, particularly if they occur repeatedly.” Earlier in the year, the SEC proposed updates to fund naming rules and a new mandatory disclosure related to ESG investment practices. Fitch said the agency’s actions have resulted in asset managers being more conservative regarding their ESG messaging.

Finsum:With regulatory actions on ESG greenwashing expected to continue, asset managers need to be more conservative with their ESG credentials.

According to data from the financial technology platform 55ip, a record number of financial advisors are taking advantage of tax-loss harvesting opportunities for their clients. Data from its platform revealed that across client portfolios through Q3, the 2022 YTD tax savings benefit for model portfolios of ETF and mutual funds was 2.99%. Going back to 2020, the annualized tax savings across clients in model portfolios on their platform was 2.82%. The tax savings illustrates the value of ongoing tax loss harvesting within client portfolios throughout the year, compared to those not harvested for tax losses. 55ip, which is a wholly owned subsidiary of J.P. Morgan Asset Management, offers advisors trading and rebalancing capabilities, in addition to automated, personalized, and optimized tax outcomes. Paul Gamble, Chief Executive Officer of 55ip stated “The growth of model portfolios is one of the fastest growing trends in asset and wealth management, but concerns about the tax implication of transitioning and managing client accounts have been a major barrier to broad use by advisors. Volatile markets can be emotionally and financially challenging for investors, but our data indicates they can also present potential opportunities for meaningful benefits from a tax perspective.”

Finsum:Based on data from 55ip’s platform, a record number of advisors are implementing tax loss harvesting in their clients’ model portfolios.