\n UBS wins clawback of bonus money from advisor recruited from First Republic.\n <\/p>\n
A three-person FINRA arbitration panel this week decided in favor<\/a> of UBS<\/a> Financial Services Inc. a dispute regarding a recruiting bonus<\/a> with a former financial advisor, who is on the hook for $5.6 million in damages and legal fees to his old firm.<\/p>\n The advisor, Terance Takyi, is a fourteen-year veteran of the securities industry who worked at UBS in New York from May 2023 to last June, according to his BrokerCheck report.\u00a0<\/p>\n Before that, he worked at First Republic Securities, whose financial advisors became highly valuable targets<\/a> of competitors after its parent company First Republic Bank became insolvent and was sold to JPMorgan Chase.\u00a0<\/p>\n Those First Republic advisors were highly prized and commanded good-sized recruiting bonuses in many cases; in its lawsuit, UBS claimed Takyi breached its promissory note, or the agreement for the recruiting bonus, which is typically paid to the advisor over seven to 10-year periods.<\/p>\n Advisors who sign promissory notes work off the loan amount over the years; if an advisor leaves before the agreed time period, he or she may be liable to pay back the loan, as in this case.<\/p>\n Takyi, who moved to LPL Financial<\/a> in Paramus, N.J after leaving UBS, did not return a phone call Friday to comment. A spokesperson for UBS declined to comment.<\/p>\n According to the FINRA Dispute Resolution Services panel decision from Wednesday, Takyi is liable for $5.5 million \u2013 the amount due on the note plus interest \u2013 to UBS. He is also liable to pay $164,000 in UBS attorneys\u2019 fees.<\/p>\n The arbitration panelists did not give any reason for the award to UBS.<\/p>\n Promissory notes used to recruit financial advisors are a fundamental part of the financial advice business but advisors are demanding \u2013 and getting \u2013 more cash than ever to leave one firm and join another.<\/p>\n Indeed, heads of giant\u00a0wealth management<\/a>\u00a0concerns continue to see their firms between a rock and a hard place when it comes to\u00a0recruiting financial advisors.<\/p>\n Last month, chief executives of large\u00a0wealth management companies<\/a>\u00a0continued to express concerns over the\u00a0expense of hiring\u00a0experienced advisors, which reached a feverish intensity last year in the aftermath of\u00a0LPL Financial\u00a0Holdings Inc.\u2019s $2.7 billion all-cash acquisition\u00a0of rival\u00a0Commonwealth Financial Network<\/a>.<\/p>\n That deal set off an industry-wide scrum for Commonwealth advisors, on average the most productive in the industry.<\/p>\n And the rising dollar amount of recruiting bonuses, known as transition assistance in the industry, has remained at levels extremely favorable to financial advisors and potentially costly firms.<\/p>\n","protected":false},"excerpt":{"rendered":"UBS wins clawback of bonus money from advisor recruited from First Republic. A three-person FINRA arbitration panel this…\n","protected":false},"author":2,"featured_media":112898,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_share_on_mastodon":"0"},"categories":[129],"tags":[54999,55025,55024,223],"class_list":["post-112897","post","type-post","status-publish","format-standard","has-post-thumbnail","category-ubs","tag-clawback","tag-first-republic","tag-loan","tag-ubs"],"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@ch\/117055858172091288","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/posts\/112897","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/comments?post=112897"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/posts\/112897\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/media\/112898"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/media?parent=112897"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/categories?post=112897"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/tags?post=112897"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}