Embattled broker GunnAllen Financial Inc. has lost a top-producing branch — the broker-dealer's first major defection since the abrupt resignations in December of its holding company's chairman and chief financial officer.
Embattled broker GunnAllen Financial Inc. has lost a top-producing branch — the broker-dealer's first major defection since the abrupt resignations in December of its holding company's chairman and chief financial officer.
Acumen Investment Services, one of GunnAllen's top-10 producing branches with 19 registered representatives, is no longer affiliated with the firm, Acumen chief Joseph LaScala told InvestmentNews. On Jan. 4, the firm became affiliated with Paulson Investment Co. Inc., which is based in Portland, Ore.
Mr. LaScala said it was with a “heavy heart” that he left GunnAllen, which his firm had been affiliated with for seven years. However, he said the recent bad news from GunnAllen had left him little choice.
Last month, John Sykes, the chairman of GunnAllen Holdings, resigned from the company's board. Scott Bendert, CFO of GunnAllen Holdings and acting chairman of the broker-dealer, also left the firm.
Officials from the Financial Industry Regulatory Authority Inc. conducted an exam of the firm's books to ensure it had enough capital to keep its doors open.
Acumen has 19 producing registered reps, and has offices in New York and Connecticut.
“We felt that as an organization that the headlines and news [about GunnAllen] was a distraction” to the advisers, Mr. LaScala 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 had yet departed, and that, overall, GunnAllen was in good shape. He said gross revenues for 2009 were down about 10% from the previous year, but declined to disclose any more specifics.
