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Towry Law granted interim injunction against former Edward Jones advisers

Towry Law has been granted an interim injunction against six former Edward Jones advisers.

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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Comments

There are 19 comments at the moment, we would love to hear your opinion too.

  1. Incompetent Regulators Awards Team 7th April 2010 at 9:54 am

    So much for Fishy Fisher keeping the EJ Advisers in a job eh!

  2. 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!

  3. 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!

  4. 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.

  5. 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?

  6. 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.

  7. Robert Donaldson 7th April 2010 at 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.

  8. 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.

  9. 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!

  10. Martyn Llewellyn-Smith 7th April 2010 at 7:06 pm

    Hi Realist, like to meet you some-time, get your facts straight before you start spouting and mis-spelling your rubish. Clients who joined Jones were offered a totally different contract and service package to the proposition they are now being forced into by TOWRY. The clients have a right to chose where they go, particularly as they cannot continue to hold their shares and corporate bonds or have the option to pay for the same service they received through Jones and the Jones trained advisers. Lets face it theYanks had it away with us all yet again and they also spat into Towry’s beer when they dumped the loss making business and legged it back to the States. Not before taking he michael out of the FSA and our financial services. How many Glittner bonds and Lemans products and AIG polices did they leave us with, probably more than the b***ard babes they left us with in 1945. How did they do it, thy pretended to care, they pulled a veil of respectibility on and created a strong corporate image, with a dazzling white smile and built a stepford wife loyalty within its new disciples who went from door to door and preached the good word, whilst all the time selling hard and fast and paying lip service to the regulators. Is it not time to stop the in fighting and get together and respect clients needs rather than treating them like cattle or a mark. Yes Jones advisers must respect their contract covenant. However Towry are not correct in treating advisers in the way they have nor should they getaway with forcing the clients into their own funds. I see a mis-selling scandal by default coming up, and I don’t want to pick up the cost in the way we will all pick Key data costs even though I have never used them. TOWRY let them people go, you are only interested in the big fish anyway, I have it on record. The Jones clients and advisers and you have all been duped and dumped by the Yanks, who is going to pick up the bill when the clients start to complain? Anyone want to join a class action against them in the States?

  11. 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.

  12. Incompetent Regulators Award Team 8th April 2010 at 8:20 am

    Good point from 3.46pm 7th April. Under employment law TL cannot stop someone from trading regardless of their contract of employment. The contract must be fair to both parties, otherwise Mr Fishy Fisher may lose the case anyway!

  13. Let the clients decide. As they have been doing in their thousands. Myself and my former colleagues have been swamped by clients contacting us and wanting to transfer.

    EJ took a $70m charge to their accounts for the UK disposal. TL have very little risk in this deal. They paid nothing for the client assets and expect to stop us from dealing with clients who come to us.

    Neither have they any proof of theft of client information by these advisers. I expect this action will be thrown out in July when it comes to trial.

    All I have to do is show the client the contract TL asked me to sign, added to the fact they have barely been contacted since October, added to the fact the replacement adviser is utterly clueless having only joined EJ in last 12 months, added to the fact TL investment charges had not been correctly explained…….
    Any fool who signed up either as an adviser or client will truly regret it.

  14. Naughty Boys and Girls! 8th April 2010 at 5:11 pm

    I hope Towry Law win this case over former EDJ employees that chose to leave the company, that are now knocking on the door of clients of the company they left and telling then not to sign anything, and to not tell anyboby they have had contact with them. I have met some very confused and distressed elderly clients of EDJ/TL. All the former EDJ employees are doing is geting the clients to sign service agent forms so the adviser can continue getting trail commission.

    If you wanted to carry on getting remuneration from the clients you brought to Edward Jones then you shoud have either carried on working for EDJ/TL or tried harder in interviews for positions.

    Move on Former EDJ employees, stop harrassing clients of EDJ/TL. If you were that good, the clients will contact you.

  15. "Let the clients decide" 8th April 2010 at 5:23 pm

    To former EDJ employee. Rather than showing the clients you used to advise when working for Edward Jones your TL contract offer; you should read your EDJ contract. If you had, you should not be sitting with you clients wether they contacted you or not.

    If you looked after their investments well when you worked for edward jones, they there should be no need for clients to move as their investments will stay the same, unless of course the best advise is whatever Towry Law’s investment service is.

  16. I was a Edward Jones Client.. needless to say that when i heard what was happening i made sure that i had my adviser’s phone number. He explained he couldn’t contact me once he left unless i contacted him first. Henceforth i did!!

    He isn’t in breach of his contract.. I have my adviser.

    Not very difficult?

  17. Personally I think that Fisher only bought EJ just to get his hands on the AUM. He does not want the advisers at all, just the assets.

    However, if he bought the business, of which EJ advisers were simply employees then he was buying company, client assets included. So the advisers can hardly take their client list and set up on their own….. however, if they do set up on their own and the clients contact them direct them there is nothing that Fisher can do about that!

  18. Point of correction. TL paid a nominal fee of £1 because that is the law. They still assumed EJ’s UK liabilities i.e leases, redundancy payments e.t.c. They just incurred a debt to acquire EJ so don’t be too hung up about the £1 payment.

  19. Any date set yet for the hearing on this case?

    FT Adviser are reporting it as the 14th July.

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