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)

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