Morgan Stanley Seeks to Stop Two Departing Advisors from Transferring Inherited Accounts

Posted on May 9th, 2022 at 2:59 PM
Morgan Stanley Seeks to Stop Two Departing Advisors from Transferring Inherited Accounts

From the Desk of Jim Eccleston at Eccleston Law:

Morgan Stanley is seeking a temporary restraining order (TRO) in an effort to block two of its former New-Jersey based advisors from soliciting clients whom they inherited via the firm’s Former Advisor Program (FAP). 

Joseph Hutchinson and Robert Gibbs allegedly violated their employment agreements by misappropriating confidential client information because of their success in transitioning clients inherited from a retired advisor, according to Morgan Stanley. Hutchinson and Gibbs, who recently joined RiversEdge Wealth partners, have transferred nearly $20 million of the $175 million book they inherited from the former advisor, Leo Russomanno. According to Morgan Stanley, Hutchinson and Gibbs agreed to a one-year solicitation ban in the event they were to depart the firm. 

Morgan Stanley sent demand letters to each advisor after their departure on April 19 prior to filing its lawsuit, but each denied misappropriating the firm’s confidential client information or soliciting the clients. According to the complaint, the $175 million in assets constituted nearly 85% of the advisors’ total client book. Hutchinson and Gibbs have been “depriving” Russomanno, who retired in 2019, of his retirement income, according to Morgan Stanley. 

Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, regulatory and disciplinary matters.

 
 

Tags: eccleston law, morgan stanley, tro

Return to Archive

TESTIMONIALS

Previous
Next

I cannot thank you enough for your efforts. You have proven to be a valuable resource

Jim T.

LATEST NEWS AND ARTICLES

June 30, 2025
SEC Charges New Mexico Investment Advisor with Fee Fraud and Fiduciary Breaches

The Securities and Exchange Commission (“SEC”) has charged David A. Nagler and his firm, New Line Capital LLC, with defrauding clients through deceptive fee disclosures and undisclosed conflicts of interest.

 

June 27, 2025
FINRA Sanctions Advisor for Accepting $1 Million Inheritance from Client Without Firm Approval

FINRA has fined and suspended veteran advisor Kenneth J. Malm for accepting a $1 million inheritance from a client without receiving the necessary firm approval.

June 26, 2025
SEC Charges Marine Veteran in $2.5 Million Ponzi Scheme

The Securities and Exchange Commission (“SEC”) has charged Marine Corps veteran Christopher Aubin with fraud, accusing him of running a $2.5 million Ponzi scheme that defrauded dozens of investors, including several of his former military colleagues.