Founders of $18.4B RIA exit JPMorgan to build client portfolios on their terms

Processing Content

• Key insight: Large wealth managers' compliance strictures can clash with advisors' investing preferences. At JPMorgan, that led a star team to leave and launch an RIA.
• What's at stake: Firms' rigid portfolio diversification and rebalancing rules risk pushing top revenue producers to independence.
• Expert quote: "If we put 4% in a portfolio and it grew to 20%, that's a good thing. That should probably be celebrated, right?" — Phil Scott, founder of Latigo Peak Partners

The founders of the RIA Latigo Peak Partners said they knew it was time to leave JPMorgan when the megabank told them to move clients out of stock positions they'd held for years.

One of Phil Scott and Jim Atwood's main goals in breaking off from JPMorgan to start their own firm with $18.4 billion in assets under management was to continue pursuing investing methods that had served their clients well over the years. Starting at Merrill, then moving the now-failed First Republic and ultimately JPMorgan, the pair had barely budged from a buy-and-hold approach toward investor portfolios.

"As a result, we've had some companies that have gone up 100 times in value," Scott said in an interview this week. "Well, when you have a stock that goes up 100 times in value, it becomes a pretty big part of a normal portfolio."

Pressures to conform at a large firm like JPMorgan

Despite what some might consider overconcentration risk, Scott and Atwood said they were told they wouldn't have to change their approach to investing after joining JPMorgan as part of its acquisition of the failed First Republic in 2023. They said that assurance came from former J.P. Morgan Advisors CEO Phil Sieg, who left in September 2025.

With Sieg gone, so was Scott and Atwood's exemption from pressures to sell stock to move clients out of highly concentrated positions and diversify their portfolios. Scott said the resulting capital-gains taxes would have been sizable.

"And in the research that we did, it would cut back on performance," said Scott, who's registered with the Financial Industry Regulatory Authority as Walter P. Schlaepfer.

"But let me be clear, we're not afraid of selling companies if they meet our sell criteria," he added. "We're very disciplined about that, but we don't want to sell something just to sell it, just to hit some sort of artificial benchmark."

Advisors leaving wirehouse, JPMorgan after First Republic purchase

The departure of Scott and Atwood — star revenue producers at JPMorgan — shows the appeal of independence for advisors at large wirehouses and other Wall Street firms. The research firm Cerulli Associates reported in 2024 that RIAs had gone from having 18% to 27% of the industry's entire headcount in the previous decade and predicted that figure would rise to 30% in the next five years. Much of that inflow has come from departures from industry stalwarts like JPMorgan.

JPMorgan meanwhile has struggled to retain advisors brought on through its purchase of First Republic out of government receivership three years ago. Atwood said he and Scott had previously left Merrill — where they started in 1984 and where Sieg had also been — in order to have greater leeway to run their business as they saw fit at First Republic.

Atwood said he and Scott were willing to give JPMorgan a try and set aside any anxieties about what its purchase of First Republic could mean for their practice.

"But as time went on, it just was clear that they weren't going to be flexible with us, and that we were going to be thrown into the same pool as everybody else," Atwood said.

Atwood said he doesn't keep in close touch with other former First Republic advisors who joined JPMorgan, but he believes a majority have left.

JPMorgan did not respond to requests for comment.

JPMorgan has shown willingness to pursue departed teams in court. Most notably, it sued 16 ex-First Republic advisors in spring 2024 in federal court in California over their attempt to avoid having to pay back $90 million in recruiting loans they received as an incentive to join First Republic from other firms. The court eventually dismissed the lawsuit after finding it had no jurisdiction over the case.

Scott said he's not particularly worried about a lawsuit. For one, he and Atwood were careful to adhere to the Broker Protocol, an industry pact giving advisors legal shelter as long as they take only limited information — client names, addresses, phone numbers, e-mails and account titles — to their new firm.

Loss of discretionary trading for certain accounts

Scott said an eye-opening moment came in September when they lost discretionary authority — the ability to make trades on clients' behalf — for about 100 client accounts. Those were instead moved into a brokerage account requiring clients to call their advisors to approve individual transactions.

"But the client doesn't know how to manage the portfolio," Scott said. "So they really essentially forced us out. The impetus was we're getting to a point where it was becoming impossible for us to take care of the clients."

Scott said he understands why JPMorgan may not want to make exceptions for certain advisors.

"They have to put rules in place that take care of like 25,000 people, right?" Scott said. "So I get where they're coming from."

Plans to grow through referrals, emphasizing investment performance

Scott and Atwood are now focused on running the RIA they launched this month with its headquarters in Palm Beach Gardens, Florida and hubs in Bellevue, Washington, and Boston, as well as a field office in Los Angeles. With not only $18.4 billion under management but also 48 staff members — including 15 advisors — Latigo Peak is off to a solid start.

The firm, which takes its name from a favorite ski slope in Beaver Creek Resort in Colorado, specializes in working with ultrahigh net worth clients and families and offers services related to estate and wealth planning, philanthropic giving and assistance for future generations. It uses Charles Schwab and Pershing as custodians safeguarding client assets.

Over the last six years, when their team's revenue production rose from $35 million to $130 million, Scott and Atwood built their business through referrals from existing clients. They said they believe having their own RIA will strengthen their ability to grow that way, especially since they will have greater freedom to talk publicly about how their investing methods have benefited clients.

Atwood said he and Scott looked at other RIAs when trying to decide how they wanted to set up Latigo Peak and found many were reticent about the performance of their investment recommendations.

"Pretty much all of them just put you in a tax-harvesting index product, and then they do a barbell, and then they put into you know some private deals," Atwood said. "And that's where they're supposed to get their alpha."

Another way Scott and Atwood will diverge from many other RIA owners is in eschewing investments from private equity owners. One of the biggest trends in wealth management in recent years has been an influx of private equity into firms looking for new sources of capital to supercharge their growth.

Atwood said he and Scott, after working so hard to regain their independence, are reluctant to cede control to another owner. Even a PE firm that takes a minority share in an RIA will want to have a say in how the firm is run.

"They're going to want to try to make as much money as they can," he said. "We're going to try to grow and whatnot, but we don't want to have anybody looking over our shoulder and then, all of a sudden, be part of some other owner five or six years down the road."

Scott said he's happy to be in a setting in which market-beating investment performance is both pursued and rewarded if attained.

"If we put 4% in a portfolio and it grew to 20%, that's a good thing," he said. "That should probably be celebrated, right?"

Introductory bullet points created by AI with editorial review.