Embattled GunnAllen loses top-producing branch

Beleaguered broker GunnAllen Financial Inc. has lost a top-producing branch — the broker-dealer's first major defection since the resignations last month of its holding company's chairman and chief financial officer. Acumen Investment Services, one of GunnAllen's top 10 producing branches, is no longer affiliated with the firm, Acumen chief Joseph LaScala said in an interview. On Jan. 4, the firm became affiliated with Paulson Investment Co. Inc. Mr. LaScala said that it was with a “heavy heart” that he left Gunn- Allen, with which his firm had been affiliated for the past seven years. However, recent events at GunnAllen left him little choice, he said. Last month, John Sykes, chairman of Gunn Allen Holdings, resigned from the company's board. Scott Bendert, the broker-dealer's chief financial officer and acting chairman, also left the firm. Officials from the Financial Industry Regulatory Authority Inc. conducted an exam of the firm's books to ensure that it had enough capital to keep its doors open. Acumen has 19 producing registered representatives and has offices in Connecticut and New York. “We felt that as an organization that the headlines and news was a distraction” to the advisers in serving clients,” Mr. La-Scala said. He declined to state his firm's gross revenue. David Levine, an executive vice president with GunnAllen Financial, said that no other top branch offices have departed and that overall, Gunn- Allen is in good shape. He said gross revenue last year was down about 10% from 2008, but declined to disclose any more specifics. E-mail Bruce Kelly at bkelly@investmentnews.com.