Amerprise Sues LPL Over 'Shocking' Recruiting Tactics
Ameriprise is seeking a preliminary injunction to block LPL from “retaining, using, disclosing, or transmitting for any purpose, including the solicitation or conducting of business with current, former, or prospective Ameriprise clients, such information contained in the records of Ameriprise, or other information pertaining to Ameriprise clients that it improperly obtained.”
That includes, but is not limited to, “the sensitive and protectable personal data and financial information of the clients and, further, to prevent Defendant LPL from destroying, erasing or otherwise making unavailable for further proceedings in this matter any such documents and/or data,” the suit states.
In a statement Tuesday, Ameriprise said that “LPL is reckless and putting clients at risk by instructing the new advisors it recruits to upload spreadsheets with confidential client information into LPL’s systems — including, but not limited to social security numbers, date of birth, net worth, and detailed account information, to poach clients without prior knowledge or consent.”
For years, Taaffe said, “LPL has flagrantly disregarded industry protocols in how it recruits financial advisors — and they have obtained and mishandled trade secrets and sensitive client data to which they are not entitled.”
Taaffe added, “It is time for LPL to be held accountable for their reckless disregard for clients and advisors — and the fact that they have demonstrated zero semblance of care when handling the personal information of thousands of unsuspecting investors who are unaware that LPL allowed and encouraged its recruits to engage in this misconduct.”
As of June 30, LPL’s advisor headcount was 23,462, up 1,520 from a year ago; advisory and brokerage assets stood at $1.5 trillion.
Ameriprise said its Advice and Wealth Management unit added 118 advisors over the past 12 months, giving it 10,392 advisors as of June 30. The unit’s total client assets were $972 billion.
Credit: Bloomberg
