Dynasty Financial Partners has added another breakaway firm to its expanding roster, but this transition is coming with some extra baggage.

Procyon Partners, formerly a team known as The FDG Group while at UBS, launched this month and will operate under two separate RIAs — one for its institutional investment consulting practice and the other for its personal wealth management group.

At UBS the Procyon team managed over $8 billion in institutional assets and over $400 million in private wealth assets, generating approximately $6 million in annual revenue.

UBS has filed a lawsuit for a temporary restraining order and a preliminary injunction against the Shelton, Connecticut-based firm. What's more, the Swiss-based wirehouse discharged Phil Fiore, one of Procyon's founders and managing partners last November for violating firm policies, according to a note contained in Fiore's BrokerCheck record.

LAWSUIT ALLEGES PROTOCOL VIOLATION

The lawsuit, filed last week, alleges that Procyon's founding partners, including Fiore, Jeffrey Farrar, Louis Gloria and Thomas Gahan violated the Protocol for Broker Recruiting by "aggressively soliciting" UBS clients to leave the firm and do business with Procyon. UBS also claims that the defendants used confidential client information "in direct breach of non-solicitation and non-disclosure agreements they signed at UBS."

The restraining order was brought two weeks after the team left UBS, according to a statement from Dynasty. "Nothing has changed as regarding the facts — the timing speaks for itself,” the statement says.

As for Fiore's dismissal, "Phil was let go for not complying with internal firm policies by not formally disclosing certain outside business activities,’” says Dynasty spokeswoman Sally Cates. “These matters were not investment or client related.”

TARGETING PROFESSIONALS WITH $1M +
The new private wealth group targets professionals with over $1 million in investable assets, with a specialty in doctors, Fiore says.

Procyon hopes to expand its individual services to high-net-worth and ultrahigh-net-worth clients to include concierge and tax planning services, according to Fiore. "The HNW market doesn't want bifurcation of services," he says. "We want to be able to give them everything they need."

Procyon also hopes to expand geographically with Dynasty's help, Fiore says. "Dynasty was the right fit for us with the right growth trajectory," he explains. "When you're coming from the wirehouse side of the business and you don't know what you don't know, you want a partner like Dynasty to help you navigate your new world."

SANCTIONED BY FINRA
Fiore, who began working for UBS in 2009 after four years at Merrill Lynch and 19 at Prudential Securities and its successor firms, was sanctioned by FINRA in 2015 when UBS applied to register him in the state of Massachusetts.

FINRA approved the application, but Massachusetts set conditions he had to follow for the next 18 months, which included heightened supervision, no discretion over retail account and no principal or supervisory duties.

A year later, UBS discharged him after concluding that while on heightened supervision Fiore "violated firm policies by not disclosing an uncompensated external directorship for a not-for-profit entity affiliated with a client for which he was an institutional consultant; not seeking approval to operate a charity golf tournament; not seeking approval to make blog posts; and not disclosing that a new client had an investment in the Financial Advisor's approved outside business."

Procyon is the seventh RIA to join Dynasty this year and the 45th overall.

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Charles Paikert

Charles Paikert

Charles Paikert is a senior editor at Financial Planning. Follow him on Twitter at @paikert.