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Morgan Stanley Goes After FA Who Left for RBC Wealth

June 13, 2019

Morgan Stanley continues pursuing departing brokers, most recently suing one of its former top representatives in Atlanta, according to news reports.

The wirehouse has accused Benjamin Joel of misappropriating the company’s trade secrets, according to a complaint filed on June 11 in federal court in Atlanta, the Atlanta Business Chronicle writes. Joel, who had been with Morgan Stanley since 1987, resigned last month to join RBC Wealth Management, according to the publication. He managed around $177 million, the Atlanta Business Chronicle writes.

"Joel recently resigned his employment with Morgan Stanley, but not before absconding with numerous forms of documentation containing Morgan Stanley’s confidential and trade secret information related to its clients," the company alleges in its complaint, according to the publication. "Joel has already begun employment with a direct competitor RBC Wealth Management ... and both before and after his resignation from Morgan Stanley, Joel wrongfully solicited — and continues to solicit — several Morgan Stanley customers."

Furthermore, Morgan Stanley financial advisor Candice Smith says in a related court filing that a lot of “Morgan Stanley customers” moved their assets out of the firm on the very first business day after Joel’s resignation and that several have followed suit, the Atlanta Business Chronicle writes.

(iStock Photos)

Morgan Stanley has been going after advisors jumping ship ever since it withdrew from the Protocol for Broker Recruiting in 2017. The accord allowed departing advisors to take some client data with them without the threat of lawsuits.

In April, however, Finra issued guidance on customer communications by departing registered representatives that may have given advisors a leg up, as reported.

The guidance suggested that broker-dealer firms promptly communicate to clients about how their accounts would be handled after a broker’s departure and that firms must give “timely and complete answers” about the departing broker as well.

By Alex Padalka
  • To read the Atlanta Business Chronicle article cited in this story, click here.