Towry Law granted interim injunction against former Edward Jones advisers
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Towry Law has been granted an interim injunction against six former Edward Jones advisers.
Source: Michael Walter/Troika
The injunction alleges solicitation of its clients and misuse of confidential client information. The date for the trial has been set for the first available date after July 14, 2010. Towry Law has been granted the injunction on behalf of Edward Jones Limited, which was acquired by Towry Law on November 12, 2009.
Towry Law paid just £1 to take over the UK arm of Edward Jones, which made a loss of £35m last year. After news of the acquisition broke, the Money Marketing website was flooded with messages of concern from Edward Jones advisers.
In January, The Times reported details of a contract being offered to former Edward Jones advisers looking to join Towry Law including bonuses depending on how much money they put into Towry’s in-house discretionary management service. Towry says there is no conflict of interest in offering advisers incentives to recommend the funds.
Towry Law chief executive Andrew Fisher (pictured) says: “We will take every action available to us to protect the interests of our shareholders and our clients. The contracts signed by the ex-Edward Jones advisers clearly state that they are not able to solicit our clients for relevant business. Misusing confidential data is not, in our opinion, ever acceptable and we are currently preparing a number of similar actions against other former employees of Edward Jones.”
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Readers' comments (17)
Incompetent Regulators Awards Team | 7 Apr 2010 9:54 am
So much for Fishy Fisher keeping the EJ Advisers in a job eh!
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Realist | 7 Apr 2010 9:55 am
Good on Fisher and Towry Law. It's about time advisers in this space started respecting the contracts they enter into.
Want the beenfit? Accept the obligations and restrictions ortherwise don't sign. Simple.
Can you imagine the outcry if this had been in the other direction? "Towry Law Steals Clients" headlines everywhere!
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Matt Kennedy | 7 Apr 2010 9:59 am
This is a classic sympton of the misguided belief that in the UK clients have relationships with companies/brands.
It has been always been the case that the value in an adviser business lies in the relationship between the individual adviser and their client.
I appreciate that many have tried to break this tie with limited success.
Be careful what you sign!
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Robert Parker | 7 Apr 2010 10:06 am
I hope this goes to trial and Towry Law win it is about time a legal ruling cleared this nonsense of course the company owns the client bank - if the advisers didnt like that they should run their own company very simple.
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John Pickles | 7 Apr 2010 10:14 am
I thought that misuse of confidential data was a criminal offence under the Data Protection Act. Surely the police should be involved if an accusation of misuse of data is alleged? And if the police are not involved then surely there can have been no allegations of misuse of data?
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michael brayne | 7 Apr 2010 10:19 am
If the clients wish to continue with their former EJ consultant then they should do so, I believe the clients wishes are paramount, clients are not something to be bought or sold. This should be a lesson to TW that if you purchase something for just £1 then don't expect it to be that good.
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Robert Donaldson | 7 Apr 2010 11:42 am
Whilst the clients have every right to deal with whom they wish, the information gained by the EJ advisors during their time as employees belong to EJ and not the advisors. It surely therefore follows that Towry Law now own those rights.
Their is no simple way round it unless the clients contact the old EJ advisor off their own back and state that they wish to deal with them and them only.
Tough but as those have said before that is the contract they signed.
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Phil | 7 Apr 2010 3:22 pm
I doubt Towry Law realised that few EJ advisers would want to join them and now clients are not impressed either and are looking to go back to the advisers that they trusted and liked.
I agree that contracts must be honoured, but this is still a people business and clients will return to the adviser they prefer.
Andrew Fisher surely made a mistake buying Edward Jones.
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Anonymous | 7 Apr 2010 3:46 pm
If the Advisor is employed then they should not have taken the details.
There is a loophole in the law that suggests that one cannot prevent another from working their trade. I hope this proves to be the case.
I don't think that Towry Law are doing themselves any favours at the moment. Clients have bought from the Advisor not the brand, otherwise why not buy from the provider!
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Kevin | 7 Apr 2010 7:33 pm
What is a client and what is a customer? Both tend to be individual people who communicate with individuals and between make a contract (sale). Invariable the product sold comes from the supplier of the investments or services but the contract is with the individual. Who signs the Suitability letter to confirm the advice is good, who signs to confirm they were present when the contract was made and who writes a report if their is a compliant?. Clients and customer deal with individuals who they trust and as individuals they are free to deal with whoever they want. It's about time all these petty restrictive covenants in employment contracts were torn up and sensible pay and conditions (and hours) were agree as a way forward. otherwise the Financial services industry will be an industry without service.
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