Legg Mason is acquiring a large stake in Financial Guard, as technology continues to permeate the financial services sector and the US prepares for the Department of Labor's new fiduciary standard affecting retirement accounts.

Legg Mason is to acquire an 82 per cent equity interest in Financial Guard, an online wealth management and investment advice platform that will operate within the former firm's alternative distribution strategies business.

The investment is part of Legg mason's strategy focused on “creating choice for investors across investment capability, product and vehicle, and distribution.” Meanwhile, the move gives Financial Guard access to a larger roster of potential clients. Terms of the transaction were not disclosed.

According to a recent survey sponsored by Legg Mason, some $845 billion is sitting in small IRA accounts of less than $25,000 at US wirehouses, independent broker-dealers and regional brokerage firms that “may be impacted by the new DoL rules” affecting retirement accounts (for news analysis on this, click here). Legg Mason said it will offer the Financial Guard platform to firms who are looking for assistance meeting expanded compliance requirements as a result of the legislation.

“More broadly, as demand continues to grow for technology-enabled advice, it becomes increasingly important for firms to offer to all of their clients technology solutions that are intuitive and easy to implement across a client’s entire portfolio,” the firm added. It also plans to bolster the Financial Guard platform’s existing capabilities with investment products from its nine independent investment managers, including multi-asset class solutions from QS Investors.

“As an online technology platform that evaluates both active and passive funds, Financial Guard creates a complete digital solution for advisors and their clients. Together, we are well-positioned to help partner firms and their advisors by providing a simple and scalable platform coupled with compelling investment offerings,” said Terence Johnson, global head of distribution at Legg Mason.    

Baltimore, MD-headquartered Legg Mason is a global asset management firm with $718 billion in assets under management as of May 31, 2016.