Charles Schwab has accused a California-based RIA, Davies Financial Advisors, of improperly diverting over $85 million in client assets that the brokerage had entrusted to a financial consultant who become a Davies wealth advisor.
Schwab, in a lawsuit filed Wednesday in the U.S. District Court for the Central District of California, accuses Davies Financial of misappropriating trade secrets, as well as unfair business practices, civil conspiracy, and interference with a contract and business relationships.
The financial services giant contends that it invested substantial resources to develop and protect its client relationships and private personal information, and provided Brett Griffin, whom it employed as a consultant, with access to that information in exchange for his commitment not to use or disclose trade-secret client data.
While employed by Schwab, and then by Davies as an investment advisor representative, Griffin — who is not named as a defendant in the suit — “secretly positioned himself and (Davies) to solicit Schwab’s clients using Schwab’s protected client lists and nonpublic personal information,” Schwab alleges.
Davies Financial — an RIA based in Murrieta, California, with about $288 million in assets under management — hired Griffin with the hope and expectation that he would divert business to the firm from Schwab, according to the suit.
The company also alleges that its former employee improperly communicated with those clients through undisclosed personal channels and misled them about his continuing affiliation with Schwab and his authority to service their Schwab accounts from Davies, the complaint alleges.
“Clients reported being confused about whether their assets were still at Schwab, whether Schwab had authorized Griffin’s outreach, and, in at least one instance, whether they were being targeted by a scam,” the lawsuit contends.
Griffin, who was affiliated with Schwab for over 18 years, is currently unregistered, according to the Financial Industry Regulatory Authority’s BrokerCheck site. His LinkedIn profile indicates that he worked as a wealth advisor with Davies from January 2024 to March 2025. He is not named as a defendant in the suit.
The complaint alleges that Griffin, acting for Davies Financial’s benefit, used Schwab’s trade secrets and confidential information to unfairly compete with the company and to interfere with Schwab’s contractual and business relationships, and to engage in unlawful and unfair business practices.
Schwab said it aims to obtain damages, injunctive relief and other remedies.
As an employee, Griffin did not develop a “book” of business at Schwab but was assigned preexisting Schwab clients or qualified leads, the complaint says. The clients generate hundreds of thousands of dollars in revenues and profits for Schwab annually, it states.
The consultant’s employment with Schwab ended in January 2024 when the company closed the Temecula, California, branch where he worked, part of a larger reorganization, the complaint notes. The company paid him a $100,000 severance package, it says.
Schwab alleges that during his notice period, before leaving the company, Griffin used LinkedIn to contact his clients. The brokerage believes that Griffin posted his personal email address on LinkedIn so clients could contact him directly and he could circumvent his contractual and other legal obligations to Schwab, according to the complaint.
“Griffin did not disconnect from clients upon leaving Schwab as required by his (confidentiality) Agreement,” the firm alleges.
Schwab described several instances in which Griffin allegedly contacted clients after leaving the company.
Davies Financial knowingly encouraged and ratified Griffin’s alleged misconduct, the complaint contends.
Davies Financial’s president didn’t immediately respond to an email seeking comment Friday. A message left Friday at a phone number believed to be Griffin’s didn’t immediately prompt a response.
© Touchpoint Markets, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to TMSalesOperations@arc-network.com. For more information visit Asset & Logo Licensing.