A Financial Industry Regulatory Authority panel says Baird must pay Wells Fargo Advisors over $23 million for alleged “raiding” of staff at a branch office in Wichita, Kansas.
“This is a large award,” said recruiter Jon Henschen, in an interview. “Raiding is brought up when firms feel they are being specifically targeted by competitors,” which appears the case with Baird and Wells Fargo Advisors.
FINRA arbitrators said Friday that Wells Fargo is responsible for nearly $11 million in compensatory damages, some $11 million in punitive damages, and about $1.5 million in costs. It denied Baird’s counterclaim.
In addition, several Baird employees are required to pay the firm the following damages plus interest: Donald Barry, about $543,000; Jill Docking, close to $181,00; Brian Docking, roughly $161,000; and Kevin McWhorter, about $115,000.
“We strongly disagree with what is asserted in this situation and with the findings, and are extremely disappointed in the size of the award,” said Baird spokesperson John Rumpf in a statement.
Wells Fargo declined to comment on the matter. (Last week, a judge in Chicago ruled that it must pay black brokers about $35 million over discrimination.)
The disagreement between Wells Fargo and Baird goes back to 2015, when Baird said it recruited six advisors and four other professionals from Wells Fargo Advisors with about $1.1 billion in client assets. This included Barry, Jill and Brian Docking (a mother-son team), McWhorter, Phillip Garrison and Suzanne Marshall.
Baird’s spokesperson said that firm expects to report “record revenues for 2016 year and … operating income in 2016 to be in line with 2015, which was a record year.”