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Eileen Cure

Regulation and Compliance > Litigation

Ex-Rep Booted Over Claims of Racism Sues LPL for $95M

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What You Need to Know

  • LPL has been sued for breach of contract by a formerly affiliated broker whom it booted last year over allegations of racism.
  • The complaint was filed this week in U.S. District Court for the Eastern District of Texas.
  • The plaintiff is seeking $95 million in damages, plus legal fees.

A financial advisor whose affiliation with LPL Financial ended last year over allegations of the advisor’s racist hiring practices is suing the broker-dealer, accusing it of a breach of contract.

Due to LPL’s “wrongful acts,” Eileen Cure — now an advisor with RIA Wealth Management of Kentucky — has been able to “retain only a small fraction of her book of business, representing a loss” of $45 million to $50 million, according to the complaint filed Thursday in U.S. District Court for the Eastern District of Texas in Beaumont.

Cure is requesting $10 million for damage to her reputation in the financial industry, $20 million for loss of income incurred as a direct result of LPL’s actions to date and in the future, $50 million for loss of income associated with LPL’s tortious interference ,and $15 million in damages associated with professional defamation.

In the suit, she is also seeking unspecified, “reasonable and necessary” attorneys’ fees and costs, as well as pre- and post-judgment interest.

A year ago, LPL said it was “deeply concerned by the statements attributed to” Cure after videos posted on TikTok and shared across social media sites alleged that she told her staff she didn’t want to interview Black applicants for an open position at her office.

The broker-dealer didn’t immediately respond to a request for comment about the matter Friday.

Complaint Details

In her complaint, Cure accuses LPL of breaching its contract with her by “not following the explicit terms of the contract [and] its failure to treat the plaintiff’s separate hiring in her accounting business as her own, separate issue” — unrelated to her advisory business — and for treating her as an employee instead of as an independent contractor.

LPL also “failed to provide 30-day notice consistent with terms and conditions found in the contract [that] would have permitted [her] to protect and place her book of business,” the complaint, which was filed Thursday, alleged.

In addition, the firm is guilty of “breach of its fiduciary duty” to Cure as custodian of her book of business, to return her book of business to her at the conclusion of their relationship” even though she allegedly had those advisory clients before she became a rep for LPL, according to the complaint.

In addition, the complaint accuses LPL of breaching its fiduciary duty to Cure’s clients “by cutting off” their ability to communicate with her “by refusing to allow clients access to their own assets,” the complaint alleged.

The allegation of Cure being “racist was thrust into the national news” by LPL and the comments it made about her, the complaint stated. Cure also claimed that “false information” was published about LPL conducting an investigation that concluded she was a racist who engaged in illegal hiring practices.

LPL also “worked to eviscerate” Cure’s business model and her personal and professional reputation, subjecting her to “public hatred, shame, disgrace, contempt, and ridicule,” the complaint alleged. LPL also “actively … worked to destroy her ability to work as a general securities representative,” according to the former LPL-affiliated registered rep.

The firm’s actions amounted to tortious interference because they “rendered it impossible” for Cure to sell her book of business to any third party and rendered her Series 7 license “useless, and created a situation in which it is now almost impossible for [her] to continue to work in the securities industry,” the complaint alleged.

The TikTok Video

In a video posted a year ago, Denise Bradley, who goes by the name auntkaren0 on TikTok and has more than 1 million followers, branded Cure the “racist of the day” after somebody on Cure’s staff forwarded Bradley an image of a statement allegedly made by Cure after a Black candidate was interviewed for the position.

LPL has “seen the video alleging discriminatory comments by Ms. Cure,” the firm said in a statement, adding: “We immediately launched an internal investigation to review the matter and a decision is forthcoming this week regarding Ms. Cure’s relationship with the firm. We will not tolerate discrimination of any kind in our LPL community.”

After a review of Cure’s conduct, the rep was “no longer a client of the firm,” LPL said in a statement provided to ThinkAdvisor one day later.

According to Bradley’s initial video, Cure allegedly told her staff in a Skype message: “i wanted to tell you i specifically said no Blacks. I’m not a prejudice person, but our clients are 90% white and i need to cater to them … so that interview was a complete waste of my time … so please don’t second-guess me or go against what i ask … listen to me and give me what i ask for, please.”

Cure had been registered with LPL since 2018, according to her report on the Financial Industry Regulatory Authority’s BrokerCheck website. She is still registered as an advisor but is not as a broker anymore, according to BrokerCheck.

(Pictured: Eileen Cure)