RJ and Makay

Citigroup surprised the financial world recently when it announced Jersey City, N.J.-based Pershing, LLC would be its clearing/custody agent as well as the backbone of its RIA business. Fidelity, which is located in Boston, had originally been named as the front-runner for the job.

As part of the deal, Pershing's RIA custody arm, Pershing Advisor Solutions, will support a Citigroup referral network that advisors have long been anticipating. Deborah McWhinney, Citigroup’s president of personal banking and wealth management, said the Citigroup plans to refer high-net-worth customers on the banking side to RIAs that Citi Personal Banking and Wealth Management chooses. Because Pershing is managing the referral network, it may be better able to get its advisors named as recipients of those referrals.