Protocol Eases Job Transition Worries For Wall Street Brokers

July 2, 2010 - PRLog -- Many Financial Advisors complain that transitioning a financial practice from one firm to another is anything but easy. In addition to the regulatory compliance issues one faces in moving accounts from one firm to another, Brokers and Advisors often find the firms they are working for have additional standards that must be met. Failure to meet those requirements may lead to litigation and even a tarnished record.  

But a number of firms have entered into a voluntary agreement that provides for Brokers and Advisors to move between these firms without penalty or retribution. This agreement is in letter form, and is called the Broker Protocol. At this point, nearly 500 Wall Street firms have become signatory - and the protocol is well on it's way to becoming an industry standard.

The "Protocol" specifies a number of steps a Broker Advisor may take in order to gain the protections of the agreement, and limits the information that a departing Broker Advisor may take from the firm to be left. The steps are designed to promote transparency and fair dealing, and go a long way towards preserving freedom of movement from one firm to another. Nevertheless, Broker Advisors must pay close attention to the requirements of the Protocol in order to obtain it's benefits, as must firms recruiting Broker Advisors under the agreement.

Advisors following the Protocol are able to move their businesses seamlessly between signatory firms, without the hassles and fear of reprisal often reported by practitioners.

TradeWallStreet Financial, a boutique securities brokerage, is the latest firm to become signatory to the Broker Protocol. "It's good news" says Rogan LaBier, Vice President of Team Development at the company.

"The added comfort engendered by the agreement is a real plus for Brokers transitioning jobs." Potential recruits considering a move to TWS have often expressed concerns about potential reprisals from the firms they were leaving, says LaBier. With the proper use of the Protocol, those concerns are mitigated.

TWS has integrated the Protocol into their recruitiment procedures. "By making the protocol part of the induction process, we've added efficiencies. Transitions are stressful and a source of worry for many Brokers, and integration of the Protocol into our internal process improves the transition process on a number of levels."

Recent market conditions have lead to many Advisors being let go from firms, or simply desiring to move based on other business and personal factors. Increased velocity of movement of personnel amongst firms has lead to increased concerns about potential litigation. The Protocol is designed to address this issue directly, by providing a voluntary framework for transitions. The Protocol benefits firms and Broker Advisors alike.

The Protocol was created in 2004 between Citigroup, Merrill Lynch, and UBS Financial Services, Inc. Though it has been available since 2004, the Protocol seems to be gaining steam as of late. The majority of signatory firms have become so within the last year or two. The protocol was originally designed to further clients’ privacy and freedom of choice as Advisors move between firms. If a departing Broker Advisor follows the protocol, neither the Advisor nor the new firm has any monetary or other liability. However, the protocol does not bar the prior firm from bringing a claim for raiding against the new firm.

Membership in the Protocol as administrated by the SIFMA, the Securities Industry and Financial Markets Association. SIFMA is the U.S. regional member of the Global Financial Markets Association (GFMA).

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Trade Wall Street International is a division of Trade Wall Street Financial LLC (www.tradewallstreet.com). Offering services in more than fifty countries, Trade Wall Street is a full service investment brokerage with a unique focus in international clientele. For more information, please visit TWS International at www.tws-international.com