An advisor, fired by Ameriprise earlier this year for listing herself as a client beneficiary, landed in even more hot water after she was accused by the firm of claiming she was still an employee there, according to court records.
The brokerage has filed for a temporary restraining order in U.S. District Court for the Central District of California to stop ex-employee advisor Li-Lin Hsu from saying she still works for Ameriprise, court documents show. Ameriprise also requests that confidential and proprietary information that allegedly showed up on Hsu's Facebook page be removed.
Additionally, Ameriprise seeks injunctive relief while it attempts to sort out a customer complaint that arose from the alleged compliance breach. The client alleges he lost approximately $10,000, according to the customer dispute, and requests an "assurance from Amerprise" that he will be fully indemnified for any alleged misconduct by the former employee.
Industry experts say if the allegations are proven, Hsu will likely face a difficult time resolving the dispute. "This is a clear violation. This woman left the firm and held herself out that she was still working there," says recruiter Bill Willis, who specializes in Amerprise candidates, but did not know Hsu.
"She can't hold herself out as still working for the firm," explains Willis. "If indeed this is true, she's violating every rule imaginable. They have very good reason for putting a temporary restraining order on her. I believe she's in jeopardy of a significant FINRA action against her."
AVOIDABLE PROBLEMS
These problems can arise, Willis and others say, when advisors are fired or decide to move to another firm. They often want to inform their clients about their departure, sometimes representing themselves as still working for the firm, and possibly in writing using firm stationery.
"If you're going to leave, or you've been fired, and you want to continue in the industry, you're best bet is to consult counsel to make sure that you're aware of what your rights are, what you can or can't take," says attorney Alan Foxman, a senior consultant with National Compliance Services, Delray Beach, Fla.
Hsu did not reply to an email sent to her, or return several calls to a number provided by Transglobal Advisory, a Pasadena, Calif., RIA that says it currently employs her as an independent contractor. An Ameriprise spokesman declined to comment.
FAMILY CONNECTION
The firm fired Hsu on March 27 for listing herself as a client's beneficiary, according to FINRA BrokerCheck records. A source says the client was in fact her mother. Hsu claims she forgot to inform Amerprise about her beneficiary status on an insurance product her mother had purchased from her, the source says.
BrokerCheck records show Hsu was fired for company policy violations related to maintaining a beneficiary relationship with a client, complaint handling, comingling of funds, and conducting business with a foreign client. The source says Hsu and her mother are of Chinese descent.
Amerprise later discovered that Hsu, even with her dismissal, was still claiming herself to be an employee advisor with the firm on her Facebook and LinkedIn pages. The posts alone were a violation of Ameriprise policies that would have gotten Hsu into trouble while still employed with the company.
TRADEMARK VIOLATION?
The information began coming down after Ameriprise filed for its temporary restraining order in late June, says the source. However, On Wall Street's own investigation found that while Hsu's LinkedIn page was updated to reflect that her employment with Ameriprise had ended, her background description still uses the same exact marketing language used by other Ameriprise advisors.
"What are your dreams and goals for retirement? I can help you achieve them with our exclusive Confident Retirement approach," opens her background summary.
The same trademarked wording shows up on the first 10 Ameriprise advisors that come up on Google. Hsu's summary even includes a trademark symbol that Ameriprise uses to market proprietary marketing content.
"They are suing her to force her to update that information," says Foxman, who also describes the impact for Ameriprise.
"I think that a situation like this does present a number of challenges for a firm, on a number of levels. There are the legal ramifications of this particular instance, as well as potential privacy issue. On the other hand, you have more general compliance concerns, of making sure that your policies and procedures are adequate to try to detect and prevent this type of wrongdoing."
"It may be their polices are adequate," he adds. "Because they did detect this instance At a minimum, Amerprise should be reviewing the procedures in her office, and if procedures firm-wide are adequate."
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