The Protocol for Broker Recruiting, which has about 1,700 members, has a new administrator — Capital Forensics.

Since May 2015, the Broker Protocol was administered by the law firm Bressler, Amery & Ross. However, in November — when Morgan Stanley left the pact — questions were raised about the firm’s handling of information. Bressler, Amery & Ross counts Morgan Stanley, UBS, Wells Fargo and several other large firms among its clients, according to industry sources.

UBS and Citigroup also left the pact after Morgan Stanley did so. Merrill Lynch, however, has stayed in it.

“We’re honored to have been selected for this role, and CFI views it as an opportunity to demonstrate our support for the continued success of the securities industry,” said Capital Forensics’ Chairman and CEO, Vadim Khavinson, in a statement.

In its role, the Palatine, Illinois-based firm says it will maintain and distribute lists of protocol signatory firms and their contact information. It will not provide legal advice related to the protocol or “police signatories’ conduct as it relates to the protocol,” it said.

“Our immediate goal is to ensure a smooth transition of those responsibilities,” Khavinson explained.

When Morgan Stanley left the protocol, attorneys with the consultancy MarketCounsel and Hamburger Law Firm said it appeared that Bressler had not immediately released this news. Protocol firms must give 10 days notice of plans to exit the agreement.

“It looks like the law firm was doing what was expected for them to do — prioritizing the interest of clients above all else, while administering the broker protocol list,” said Brian Hamburger, head of both MarketCounsel and Hamburger Law, on a conference call with the media at the time. “There should be a [third] party that has a more neutral standing as the administrator.”

“The problem was that [Morgan Stanley’s] notice was only given to a law firm – not to the broker protocol membership … [and this] law firm … administers the protocol and has served as [legal counsel] for UBS and Morgan Stanley,” said Sharron Ash, chief litigation attorney at Hamburger Law, during the call. “I was flatly told, ‘You will need to wait for the update, in prepared statement.’”

“If Bressler kept the withdrawal [news to itself], this is seismic. If they kept it embargoed for seven of the 10 days, that really is making a mockery of the notice period,” she explained.

Withdrawing from the protocol, which potentially discourages advisors from leaving since it subjects them to the risk of litigation, is not an effective retention strategy, Ash added. “The transitions will continue to happen.”

— Check out Broker Protocol Exodus Could Cause Breakaway ‘Spike’ in Next Few Months: DeVoe on ThinkAdvisor.