2020-02-10 Bloomberg Businessweek

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BloombergBusinessweek February 10, 2020

separateaccounthigh-net-worthassetmanagement.”

Inhispromotions,Fisherhaslongstressedhisstatusasa

bestsellingauthor,likehisfather.TheyoungerFisherhadhelp

fromhiscompany,whichboughtcopiesofhisbooks.Some

employeescouldexpensebooks,whichwouldpileupinware-

housesandstaffers’garages,accordingtopeoplefamiliarwith

the arrangement. The company says that it sent books to cus-

tomers for educational purposes and that they were “a perfectly

legitimate business expense.”

Despite being so much in the public eye, Fisher describes

himself as an introvert. He can be nerdy, rattling off economic

and financial jargon such as “mean variance optimization.” He

can also be condescending when challenged. “That’s one of

the most basic questions that anyone could possibly ever ask,

soletmetakeyouthroughthebasicthinkingtoseeit cor-

rectly,”herespondstoa questioninaninterviewabouthis

investmentapproach.

Stillhedoesn’tcomeoffasa polishedfinanceguy.Hedrives

a 15-year-oldVolvoandlikestoduct-tapetogetheroldshoes.He

wenttoHumboldtStateUniversityinruralArcata,Calif.,where

fora timehewantedtostudyforestry.Heswitchedtoeconom-

ics,andaftergraduationwenttoworkforhisdad.Whilesetting

uphisownbusiness,heusedtoplayslideguitarindivebars.As

it grew,hepositionedhimselfasa marketexpertandanadvo-

catefortheeverydayaffluent.

AmonghisbooksareHowtoSmella Rat:TheFiveSignsof

FinancialFraudandDebunkery:LearnIt,DoIt,andProfitFrom

It—SeeingThroughWallStreet’sMoney-KillingMyths. He’svery

goodatshowingthemanywaysbrokers,asthejokegoes,can

maketheircustomersbroker.Fisheris bestknownforhisads

PREVIOUS SPREAD: GILLIANNE TEDDER/BLOOMBERG. DATA: SEC

$120b

90

60

30

0

2009 2019

Fisher’s Assets Under

Management

that blare, “I HATE Annuities. And you should, too.” He’s even

more emphatic in a promotional video, saying, “I would die

and go to hell before I would sell an annuity.” He’s picked a fat,

largely deserving target. Annuities, which are a kind of invest-

ment product issued by insurance companies, are notorious for

their punishing fees and confusing rules. And they’re aimed at

many of the same people Fisher is selling to—people who may

have a half-million or more squirreled away in a 401(k) or an

IRA rollover.

Fisher’s ads invite readers to call or click to get a free report.

That gets you on the sales-lead list. Some 125 people have filed

complaints against Fisher Investments with the Federal Trade

Commission since 2016, alleging excessive calls, emails, and

mailings, according to records released under the Freedom

of Information Act. “CALLS REPEAT EVERY DAY. I SUBMIT A

COMPLAINT EVERY DAY. NO CORRECTIVE ACTION TAKEN.

WHAT CAN I DO???????????????????,” a resident from Waterford,

Pa., wrote in a July 2016 email to the FTC. The company dis-

putes the FTC complaints and says its sales force acts “respect-

fully and professionally.”

Fishersaystheimportantthing abouthisapproachis

thatsalesandfinancialadvicearekeptdistinct.Traditional

commission-based brokers are expected to sell hard—to engage

in what Fisher calls “hornswoggling”—at the same time that

they’re providing service to customers. “I didn’t like that,” he

says. “So I wanted to separate the sales from post-sales service.”

Once individual customers sign on with Fisher, his company

generally charges 1% to 1.5% of assets per year to run their port-

folios. Although that far exceeds the cost of investing in most

mutual funds, Fisher says the price includes broader financial

advice, as well as extras such as hundreds of private luncheons

for clients around the country. “We do things for clients that no

oneelsedoes,”saysFisher,whocallsit “atotaloffering.”

loomberg Businessweek spoke with more than two

dozen current and former employees of Fisher

Investments. Some describe an always-be-calling

operation reminiscent of a David Mamet play. In

addition to the Woodside location, Fisher has main offices in

the city of San Mateo and Plano, Texas. Several years ago he

moved the company’s headquarters to woodsy Camas, Wash.,

outside of Portland.

Michael Kay, who worked as an account executive from 2017

until June, says he would make at least 250 outbound sales calls

a day. “Fisher recruits people out of college,” he says in an inter-

view. “We are poor, smart, and hungry for money, so we can

be molded into an efficient closing sales machine.” Kay testi-

fied in a 2018 lawsuit in California claiming that Fisher stiffed

“That’s one of the most basic questions

anyone could possibly ever ask, so let me

take you through the basic thinking”