William Nicklin’s troubled investment firm NSB Advisors LLC has filed for bankruptcy protection with a plan to sell its assets to Emancipation Management LLC, the Wall Street Journal reported today. NSB, whose assets under management were more than $1.2 billion in 2012, filed for chapter 11 protection on Monday after a 2012 dispute with its custodian broker led to a flight of clients. In an affidavit filed with the court, Nicklin placed much of the blame for the Fishkill, N.Y.-based brokerage’s financial woes on its former custodian, C.L. King & Associates Inc. About three years ago, Nicklin said, C.L. King told NSB that it needed to reduce its clients’ collective balances by $231 million for regulatory reasons. According to Nicklin, C.L. King also sent letters to his biggest clients urging them to move their accounts. A lawyer for C.L. King, Richard Roth of the Roth Law Firm LLC in New York, denied Nicklin’s allegations. NSB now has just a fraction of its former customers — 410 accounts and assets under management of approximately $143 million, Nicklin said.
