A 35-day round trip shows the risk in a wirehouse transition

David D. Powell left Morgan Stanley for RBC Wealth Management on June 10. He was back at Morgan Stanley by July 15. AdvisorHub, citing registration records, describes the 35-day round trip as a rare kind of failed move.

Powell had spent 16 years at Morgan Stanley before leaving. He sat on the Pacific Wealth Management Group, which managed $7.8 billion in assets, according to a source close to the group cited by AdvisorHub. None of the other dozen advisors on the team moved with him, and he rejoined the team on his return, the report says. His earlier career was institutional consulting, two decades of it. He came to retail at Morgan Stanley in 2010.

The report doesn't say why the move collapsed. AdvisorHub offers two possibilities. One is that Powell decided the change was a mistake and forfeited significant transition money. The other is that RBC concluded it hadn't gotten the advisor it thought it was hiring.

Powell's move is instructive for what didn't travel. He was embedded in a large team, where individual client relationships are bundled into the group's production. A transition package is a bet on portability. When production is joint, the book may not follow the person.

Before signing a transition package, an advisor should test ownership. Which household revenue is credited to your number? Can that number leave the team? If the answer is no, the round trip suggests the real cost is not the repaid bonus. It is the clients, the team, and the trust rebuilt in place.