Wells Fargo Brokers Hesitate to Sign New Team Agreements

Posted on June 24th, 2014 at 9:00 AM

From the Desk of Jim Eccleston at Eccleston Law Offices:

Securities firms have been encouraging brokers to work on teams to increase contact options for clients, to enhance selling of specialized services and products and to make it more difficult for individuals to jump to another firm.

Wells Fargo Advisors have outlined a new team agreement to promote teams rather than individual advisors. The new team benefits will be made available to the more than 11,000 brokers.

According to the agreement, brokers who sign the deal may receive some bonuses they otherwise would not qualify for individually. And for the first time, Wells Fargo said advisors could share deferred bonus awards, devise inter-team revenue splits, and transfer revenue-target goals and recognition club trips among themselves.

However, some reps still hesitate to sign the agreement because they are concerned that the agreement could lead to a client grab when teams change or dissolve. The team agreement allows Wells to dissolve the team at its discretion if it determines the action is in the best interest of the clients, the team members or the firm. More importantly, it allows Wells to override the teams’ own arrangements for reassigning accounts when a broker leaves or dies, and to assign that person's accounts to brokers outside the team.

The attorneys of Eccleston Law Offices represent investors and advisers nationwide in securities and employment matters. Our attorneys draw on a combined experience of nearly 50 years in delivering the highest quality legal services.

Related Attorneys: James J. Eccleston


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