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TAG Associates

provides unbiased, customized financial advice to wealthy families, foundations, and endowments.


Family Office Joins Forces With Accountant

By Andrew Willmott

Most firms serving the high-net worth are striving to create an integrated wealth management model. A family office and an accountant have come up with a novel way to achieve the blend. Multi-family office TAG Associates and accountant Eisner have created TAG Eisner, an independent joint venture.

Accountants and family offices typically work together on a referral basis. The TAG and Eisner deal takes that a few steps further. "Eisner will introduce the client who's in need of portfolio management or family office services," explains Stanley Pantowich, CEO of New York-based TAG Associates. Unlike typical referral situations, an Eisner partner will play a large part in the asset allocation and investment objectives discussion, Pantowich continues.

"They understand the psychology of the client, their risk tolerance, the family dynamics," Pantowich explains. "The essence of asset allocation is getting into the heart and soul of the client. Rather than just receiving a referral fee, Eisner will actively help us and the client."

"This might be the beginning of something," comments D. Chris Brown, an independent industry consultant who previously work for Financial Research Corp. and authored many of their studies on the high-net-worth and investment management market. "It sounds like a sensible combination," Brown continues. "Competition is heating up to provide services to the ultra-wealthy, and firms are looking for new ways to compete," he explains. "With TAG providing family office services and Eisner the accounting, they can market a full-service entity for higher-end clientele," he continues. "They should be able to increase share of wallet among current clients and reach out to new ones with a more efficient model."

Brown believes many families will welcome having all their needs serviced in one place, but says some may be wary initially. "Tax-planning is clearly very germane to higher-net-worth clients," he says. "It's a powerful arsenal of capabilities to bring together." Brown points out that account aggregation may also be easier to achieve with everything under one roof.

"Our philosophies are very compatible, in terms of client service," notes Suzette Loh, a principal with Eisner. Previously, the accountant worked on a referral basis when clients wanted wealth management services. "It was never satisfactory," Loh explains. "The world is a different place, the client is far more sophisticated," she continues. "The level of sophistication required to provide the right asset allocation and investment strategy is beyond referral capacity. We can't do the right job by referring clients to three or four financial institutions," she points out.

Pantowich says that it is unlikely TAG will look to expand the roster of outside managers it uses as a result of the new venture. "We have high expectations for growth, but most managers we work with have capacity," he notes.

The new venture is equally-owned by both parties and a separate legal entity. At the moment, there are no plans to open a separate office or recruit new staff. "It's a mechanism to deliver value-added services to existing Eisner clients and new TAG Eisner clients through a separate entity," Loh says.

TAG is headquartered in New York and currently manages $3 billion in assets for about 80 wealthy families. Eisner is also based in New York.

(This article was taken from Republished by permission.)