TD Bank accused several former advisers who joined Raymond James of breaking non-solicitation oaths and taking clients with about $22 million in assets to walk away with. The bank asked the federal courts to grant a restraining order against the former employees.
TD Bank and TD Private Client Wealth filed their complaint and request for a temporary restraining order in Connecticut federal court this week. They named advisers Brett Bartkiewicz and Greg Desmarais, Raymond James and Crescent Point Private Wealth, the related firm the pair joined, in the lawsuit.
Bartkiewicz's career in the industry dates back to 1994. According to SEC filings, he worked at Merrill Lynch, Wachovia, Fisher Investments and Mercer (among others) before joining TD Private Client Wealth in 2016. Desmarais joined firm in 2011, according to the complaint.
TD Private Client Wealth argued in the complaint that as a condition of their employment, Bartkiewicz and Desmarais signed agreements to maintain the bank's confidentiality and trade secrets and that for 12 months after their employment with TD Private Client Wealth ended, the advisers would not “contact, call or solicit” any customer to lure their business away from the bank.
However, according to the complaint, on April 25, both advisers resigned “abruptly” from TD Bank. Shortly thereafter, the pair joined Raymond James Financial Services with Crescent Point Private Wealth as “family wealth advisors.”
Crescent Point, headquartered in Glastonbury, Conn., is an independent firm affiliated with Raymond James Financial Services Advisors, the company's existing corporate RIA.
But since they resigned, TD Private Client Wealth “received information” that led them to believe the two advisers were contacting TD Private Client Wealth clients directly and offering “significant fee discounts or product deals” to attract them to transfer their business to Raymond James.
“In their positions as Private Client Investment Advisor and Relationship Manager, both men were familiar with TD Bank's fee structure, including the fees charged to individual customers,” the complaint said.
Within a week of the advisers leaving, TD Bank lost at least 10 accounts worth more than $22 million. The bank hypothesized that the pair sought out at least 12 TD Private Client Wealth clients after they resigned and offered some of them significantly reduced fees to lure them to Raymond James (in one case offering a 15% fee cut , according to the complaint).
Representatives from Raymond James did not respond to a request for comment before publication.
In February, JP Morgan also sued a former employee for jumping into Raymond James and soliciting clients in violation of their alleged restrictive covenants. According to that suit, Matthew D. Sitarski worked as an adviser to the bank's Ann Arbor, Mich. branch, but withdrew nearly $4 million in business after leaving for Raymond James (the parties are currently in FINRA arbitration).