Legal Question in Legal Ethics in Wisconsin
Ethics Question....
I have an IRA at the fourth largest bank in the US for more than ten years. I've had a decent relationship with good communication with my funds manager: he calls me several times a year to discuss changes in the market, fund balances, my retirement plans, etc. I've had perhaps four different fund managers in the past ten years; they've come and gone fairly regularly.
My fund manager left about a week ago. He sent me an email to let me know that he has joined a new investment firm. Today, on a Sunday, no less, I receive a FedEx package. Inside is a letter stating that he has enclosed all the paperwork with numerous places noted where I should sign in order to transfer my funds over to the new company and away from the other company.
I have to say that in the 20 years I've had my IRA; I've never had someone so blatantly attempt to push my hand in transferring responsibility to another company. None of the other fund managers who left even sent me a letter to say that they were leaving, much less try to take my ''business'' with them when they left. Am I wrong to think this is highly unethical? All I can guess is that he did not have a non-compete clause in his employment contract, or he is disregarding it.
Comments?
1 Answer from Attorneys
Stock Broker Bringing Clients to New Employer
Stock Broker Bringing Clients to New Employer
I am not an expert in law pertaining to investment advisors and their employers. I also certainly could not comment on any non-compete agreement which an advisor may have had with a past employer without reviewing it, nor am I knowledgeable of financial advisor industry ethics rules. My advice would be that you retain an attorney and have him research this issue if you are concerned that you may be liable for moving your accounts. The Wisconsin Department of Financial Institutions at http://www.wdfi.org/ may have information for you in this regard. One thing I can suggest, however, is that you are probably free to move your accounts anywhere you want to go and should probably base your decision upon the skill and competence of your advisor rather than who his employer may be at any particular moment in time. You should also make sure that you are aware whether or not your investments will continue to be federally insured if you move them (assuming that they were already in an FDIC insured account). My comments here are not intended as legal advice to you unless you subsequently retain me and revisit this issue with me afterwards.
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