SAN FRANCISCO—Two ex–Wells Fargo financial advisors are suing the bank over a referral-generating system they say violated clients' privacy and, ultimately, led to their being let go by the bank.
“Los Angeles–based advisors Karen Keusayan and Richard Green had been with Wells Fargo since 2001 and 2004, respectively, and teamed to eventually produce a book of business exceeding $1 billion in assets, according to their lawsuit's complaint, filed in Los Angeles County Superior Court,” Financial Advisor reported. “They resigned and moved to Morgan Stanley in 2021, amid hostile backlash to their opposition to the bank's use of client discovery reviews, which identified opportunities for cross-selling its services, the complaint asserts.”
Citing the complaint, the report explains that in 2018 CDRs were added as a performance metric used at Wells Fargo to determine advisors' compensation and were required to be completed for at least 50% of each advisor's "in focus" customer relationships, according to the complaint.
What CDRs Do
The CDRs, which highlighted clients' potential financial services needs beyond brokerage and advisory services, were compiled by advisors in the Wells Fargo Advisors employee channel but used by those in Wells' Private Bank, the complaint asserts, according to Financial Advisor.
Although the advisors had to affirm in writing that the CDR's information had been discussed with the client and that the client was offered an opportunity to receive a copy, "high-ranking compliance personnel at Wells Fargo Advisors repeatedly told Plaintiffs to never deliver or present the CDR to the client since, as it was explained by compliance, the CDR was a bank document," the complaint charges.
‘Dishonest Instructions’
Keusayan and Green allege those "dishonest instructions ... forced them into an impossible position wherein they were effectively unable to truthfully attest that their clients had been informed about the existence and internal dissemination to the bank of their sensitive private and personal information,” according to report.
In addition, Financial Advisor said they claim that, when they resisted "intense" pressure to complete CDRs, they were subjected to a monthslong course of retaliatory acts, which included decreased client support, Green being publicly berated by a supervisor and Keusayan being told that her sister — a Wells customer — would not be issued a Wells credit card without completing a CDR.
Financial Advisor further reported that Keusayan and Green claim that the retaliation caused "increasingly elevated and unhealthy levels of emotional distress, substantial anxiety, and even difficulty in their personal/family lives," leading them to resign in the spring of 2021.
Allegation of Unpaid Compensation
The advisors further claim that, soon after their resignation, they were informed that Wells intended to withhold nearly $1.5 million in combined unvested deferred compensation they had earned, Financial Advisor said.
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