A FINRA arbitration panel ordered a former Merrill Lynch advisor to pay the wirehouse nearly $1.3 million in an unusual breach of contract decision, attorneys say.
Derek Greeff, who left the wirehouse to join Ameriprise in 2012 according to BrokerCheck, was ordered to repay Merrill over $1 million for the outstanding balance of a promissory note plus interest. The three-person panel split on awarding $200,000 in attorneys fees to Merrill. It was not clear why one arbitrator dissented from the majority an unusual decision, attorneys say, in a case involving breach of contract.
"When I see a dissent, it tells me one of the arbitrators felt strongly," says Tom Lewis, an attorney at Stevens & Lee, a law firm in the Laurenceville section of Lawrence Township, N.J.
Arbitrators usually find a way to compromise, says Lewis. Attorney Lars Soreide of Soreide Law Group in Pompano Beach, Fla., says he discovers dissent more often in consumer arbitration cases, "where it is a lot grayer about who is right and who is wrong."
Lawyers said it's possible that the arbitrator disagreed with the size of the attorneys fees. But as part of the decision, the arbitrators did not provide a reason for their ruling and the dissenting arbitrator provided no explanation for the dissent.
"Because of the secret process you never really know [what they are thinking] and arbitrators are not allowed to talk about it after the fact," says Lewis.
A spokesman for Merrill said the firm was pleased with the decision. Neither Greeff nor his attorney returned requests for comment.
Greeff, who has more than 25 years of industry experience, left UBS to join Merrill in 2008, according to BrokerCheck.
This is not Merrill's first victory in seeking clawbacks from former advisors who have joined Ameriprise. In April, the wirehouse won nearly $1 million from advisor Geoffrey Ellis Orbach, who left Merrill for Ameriprise in 2013.
Though the arbitration panel ruled in Merrill's favor in that case, the award fell short of the $1.4 million that the firm ultimately sought from Orbach.
In March, another Ameriprise advisor beat back a $250,000 claim sought by Merrill. The arbitration panel ruled in favor of former wirehouse advisor Rene Espinoza.
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