Citizens Investment Services is a financial advisor with its headquarters in Dedham, Massachusetts. The firm (whose legal name is Citizens Securities, Inc.) is the main investment arm of Citizens Bank, one of the largest financial institutions in the U.S.
The firm has a large team of financial advisors who manage $3.57 billion worth of client assets. The firm's client base consists almost entirely of individuals. The firm does not provide dedicated financial planning services, instead focusing on investing and portfolio management.
Certain advisors at Citizens Investment Services may earn additional compensation for the sale of specific securities to clients, which makes it a fee-based firm. That's different from a fee-only firm, which avoids conflicts of interest by only accepting fees directly from clients.
Citizens Investment Services Background
Citizens Investment Services was established in 1995, but it only registered with the U.S. Securities and Exchange Commission (SEC) as an investment advisor in 2003. The firm is owned by Citizens Bank, N.A., as well as and its parent company, Citizens Financial Group, Inc. Bruce Van Saun serves as chairman and CEO of Citizens Financial Group.
Citizens Investment Services has branches and advisors across 12 states, all on the East Coast on the U.S. The firm's advisory employees hold a number of professional designations, including certified retirement counselor (CRC) and certified financial planner (CFP).
Citizens Investment Services Client Types and Minimum Account Sizes
Citizens Investment Services works mainly with individuals, including both high net worth and non-high-net-worth clients. The firm also maintains advisory relationships with a number of businesses. The firm says that its advisors can also work with trusts, estates, Taft-Hartley plans, non-profits and more.
The minimum account size at Citizens Investment Services depends on the type of account you're looking to open:
- Managed Account Program
- Citizens Advisory Connect Program: $12,500
- Custom Select Portfolios: $50,000
- Integrated Portfolios: $25,000
- Individual managers: $10,000 to $500,000
- Digital Advice Program: $5,000
Services Offered by Citizens Investment Services
Citizens Investment Services offers investment and portfolio management services to clients. The firm has two main offerings: Citizens Advisory Solutions Managed Account Program and the Citizens Digital Advice Program. Here's a breakdown of each:
- Citizens Advisory Solutions Managed Account Program
- Custom Select Portfolios
- Features risk-adjusted asset allocations and model portfolios that are made up of mutual funds and exchange-traded funds (ETFs)
- Non-discretionary services, so clients must approve investment decisions
- Wrap Strategists
- Works similary to Custom Select Portfolios, as it's centered around risk-adjusted model portfolios containing mutual funds, ETFs or both
- These are wrap fee programs, so all trading and transactional fees are included with advisory charges
- Integrated Portfolios
- Unified managed account (UMA) program with access to a diversified portfolio of mutual funds, ETFs, separately managed accounts (SMAs) and Wrap Strategist portfolios
- Custom Select Portfolios
- Citizens Digital Advice Program
- Robo-advisor services offered through SigFig Wealth Management
- Risk-adjusted model portfolios
- Tax-loss harvesting features
Citizens Investment Services Investment Philosophy
Citizens Investment Services Investment offers many investment services through third-party managers, so there is no overarching investment philosophy that the firm adheres to. Certain accounts and strategies are more aggressive and risky in pursuit of growth, while others are more conservative. Accounts also vary in the range of securities used to craft portfolios.
Many of the firm's programs use computer-based investment research, along with analytical data, to help inform their final investment decisions. Since Citizens Investment Services uses a variety of advisors and third-party managers for investment accounts, each client will be informed of the specific investment philosophy on a case-by-case basis.
Fees Under Citizens Investment Services
Citizens Investment Services charges a wide range of fees depending on the program you subscribe to and your overall assets under management (AUM). The fees noted below do not include any applicable sub-manager fees. Fees are calculated and paid on a quarterly basis. Some fees are negotiable.
|Custom Select Portfolios Fees|
|Total AUM||Annual Fee|
|$5MM and up||0.93%|
|Citizens Integrated Portfolios Unified Managed Account Fees|
|Total AUM||Annual Fee|
|$5MM and up||0.96%|
Wrap Strategist program fees vary widely depending on the type of model portfolio you invest in. Like the programs above, these fee schedules tend to operate on an AUM-based system, with those with more invested paying lower rates.
On the other hand, the Digital Advice Program charges a flat rate management fee of 0.50%. These charges are paid monthly, in arrears, based on your account's value on the last business day of the preceding calendar month.
What to Watch Out For
Since Citizens Investment Services is a fee-based firm, certain advisors here may receive extra compensation when they sell certain securities to clients. Because of this, advisors may have an incentive to recommend certain investments over others, which represents a potential conflict of interest. However, the firm and its advisors are still fiduciaries and are legally obligated to act with the best interests of clients in mind at all times.
Citizens Securities has several disclosures that show up on its Form ADV. While some of these only refer to the firm's advisory affiliates, many of them directly involve Citizens Securities. These disclosures relate to a variety of issues, including failing to properly disclose relationships with other entities. Other disclosures include:
- Failing to disclose client complaints in a timely manner
- Failure to implement an adequate supervisory system
- Disadvantaging certain clients who were eligible to purchase mutual funds without a sales charge
- Failing to supervise the sale of certain annuity products
As a result of these violations, the firm has paid thousands of dollars in fines and has submitted to censure and disgorgement.
Opening an Account With Citizens Investment Services
If you're looking to open an account and begin working with with Citizens Investment Services, there are several contact options. You can go online to the firm's website and send a secure message so a representative can reach out to you. You can also call the firm at (800) 242-2224 or visit a nearby branch.
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