Former broker wins $600,000 arb award for claims related to sale of business

Ameriprise broker who bought book of business claims the seller tried to win the clients back.

May 8, 2019 @ 3:04 pm

By Ryan W. Neal

A former broker won a $600,000 arbitration award for claims that another broker reneged on a deal to sell his book of business.

According to a Financial Industry Regulatory Authority Inc. filing, former Ameriprise Financial Services broker Peter Butler acquired the business of another Ameriprise broker, Craig Wiggins. Mr. Butler claims Mr. Wiggins tried to recapture the clients after he learned that Mr. Butler intended to resell the business to a third party.

Mr. Butler alleges Mr. Wiggins contacted the clients and transferred them back to his own firm, Financial Management Strategies, with the help of his new broker-dealer, Cetera Financial Services.

Mr. Butler initially sought damages of at least $975,000 for breach of contract, misappropriation of trade secrets, breach of fiduciary duty, civil conspiracy, unjust enrichment, interference with contractual relationships and violation of Finra Rule 2010.

The claims against Cetera were dismissed, and Cetera declined to comment on the arbitration. The misappropriation of trade secrets claim was also dismissed.

Mr. Wiggins filed a counterclaim alleging that Mr. Butler failed to pay the full amount he owed for the transaction.

A three-person arbitration panel found in favor of both parties, deciding Mr. Butler still owed $110,000 for the initial acquisition. This offset some of the damages the panel awarded Mr. Butler, bringing the net total that Mr. Wiggins owes to $490,000.

"I think that we're pleased with the outcome," said Joseph Baker, an attorney with Baker & Roszczyk who represented Mr. Butler. "It looks like both sides received a fair hearing."

The attorney representing Mr. Wiggins did not respond to a request for comment.

(More: Finra proposes rule to hit rogue firms in the pocketbook)

0
Comments

What do you think?

View comments

Most watched

INTV

Young advisers envision a radically different business in five years

Fintech and sustainable investing are two factors being watched closely by some of the 2019 class of InvestmentNews' 40 Under 40.

INTV

Young professionals see lots of opportunity to reinvent the advice experience

Members of the 2019 InvestmentNews class of 40 Under 40 have strategies to overcome the challenges of being young in a mature industry.

Latest news & opinion

Target-date fund design may be wrong for retirees

Researchers suggest the funds don't adequately hedge against sequence-of-returns risk in retirement.

InvestmentNews' 2019 class of 40 Under 40

Our 40 Under 40 project, now in its sixth year, highlights young talent in the financial advice industry. These individuals illustrate the tremendous potential of those coming up in the profession. These stories will surprise, entertain, educate and inspire.

New Jersey fiduciary rule: Pressure leads to public hearing, comment deadline extension

Industry push results in chance to air grievances on July 17 and another month to present objections.

Galvin to propose fiduciary rule for Massachusetts brokers

The secretary of the commonwealth is proposing a fiduciary standard in response to an SEC investment-advice rule he views as too weak.

Summer reading recommendations from financial advisers

Here are some books that will keep you informed and entertained during summer's downtime

X

Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting investmentnews.com? It'll help us continue to serve you.

Yes, show me how to whitelist investmentnews.com

Ad blocker detected. Please whitelist us or give premium a try.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print