Wells Fargo claws back more than $1 million from broker claiming wrongful termination, Finra says

Wells Fargo & Co. is clawing back more than $1 million from a broker who claimed wrongful termination, according to the Financial Industry Regulatory Authority Inc. Eric Zakarin must pay Wells Fargo $1.14 million in damages for breaching a promissory note contract, according to a Finra arbitration document dated Oct. 21. Promissory notes are tied to compensation brokers receive when joining a firm. Finra arbitration panels typically decide in favor of the employer as the multi-year agreements are contractual and stipulate that unpaid balances must be returned on a pro rata basis when brokers leave. That doesn't keep financial advisers from trying to keep the money, which is paid upfront when they're hired, particularly when there's a dispute over their departure. Mr. Zakarin made a counterclaim against Wells Fargo, charging defamation and wrongful termination, citing intentional interference with their prospective economic relationship. Finra's BrokerCheck shows he was discharged from Wells Fargo Advisors in April 2015 after helping a client repatriate currency from Switzerland to the U.S. while remaining in Europe. Mr. Zakarin allegedly failed to provide necessary documentation to U.S. Customs and Border Protection. The arbitrators, who heard the promissory note case in Newark, N.J., denied his counterclaim as well as the request he made to expunge his record. Fighting to keep such compensation can be expensive for brokers. Beyond compensatory damages for the unpaid portion of the notes, Mr. Zakarin must pay about $96,000 in accrued interest. The panel also held him responsible for about $357,000 of Well Fargo's attorneys' fees and almost $10,000 in other costs, the Finra document shows. After his termination, he joined Independent Financial Group a San Diego, Calif.-based broker-dealer, in May 2015, according to BrokerCheck. He's employed by the firm in Westfield, N.J. Mr. Zakarin didn't immediately return a phone call seeking comment about the Finra arbitration outcome. (More: See recent promissory note dispute involving Merrill Lynch, which owes stiffed brokers $800,000 in damages after termination dispute )