What You Need to Know
An ex-Fidelity broker asserted causes of action against the firm that included wrongful termination and defamation.
He also sought expungement of the Form U5 termination disclosures on his record and expungement of a client complaint.
The $500,000 award was less than the $1 million in damages he had requested.
Two members of a three-person arbitration panel in New York ordered Fidelity to pay a former broker of the firm $500,000 in compensatory damages after he accused the firm of wrongfully terminating him and defaming him.
The arb panel’s award ruling, posted on the Financial Industry Regulatory Authority website on Tuesday, was significantly less than the “damages in an amount in excess of” $1 million plus interest, costs, expenses including expert witness fees and unspecified punitive damages that Ryan Sanghak Lee had requested in the amended complaint he filed in 2020.
Fidelity and Lee’s attorney, Laurence Landsman, a partner at Landsman Saldinger Carroll in Chicago, did not immediately respond to requests for comment on Friday.
Lee had asserted causes of action that included wrongful termination, defamation and defamation per se, tortious interference with prospective economic advantage and “spoliation/fraudulent concealment of evidence.”
Lee also sought expungement of the Form U5 termination disclosures on his record and expungement of a client complaint.
The client alleged that Lee’s “recommendation to surrender an annuity to fund a managed account was unsuitable and resulted in unanticipated tax consequences,” and requested $22,000 in damages, according too a disclosure on the ex-broker’s report at FINRA’s BrokerCheck website. The request was denied.
“I did not advise the [client] to surrender her annuity to fund her managed account (she was aware that in doing so a tax liability may be created),” Lee said in response to the client in the disclosure.
It was the client’s “sole decision to transfer the funds to the managed account as she did not feel comfortable in managing her own investments within the annuity,” he added. “All disclosures and details supporting this event had been properly documented.”