Calling a departed reps book?

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Feb 24, 2007 9:23 am

We had a big producer leave last week ...


The guy was a complete malcontent... He complained in every meeting and thought the whole world was jealous of him.  On a national management level he was known as the wart in our system.  He left and I've been pounding his book.  In 16 years in the biz I have never felt good about that but I have no problem w/ it this time.  It's unbelievable how many clients (notice I didn't say HIS) are glad to be rid of him. His license is like a Christmas tree and he has so many accounts he's always making mistakes...


I'm not claiming "this is just business".  I genuinely didn't like the guy's attitude and his clients have been WAY underserved for years...


It's obviously self serving -


Soo - let the flames begin - would YOU call this guys book?

Feb 24, 2007 12:10 pm

I think you are asking for it but in my opinion if he was that much of an idiot you would be doing a disservice to the customer to not pick up those accounts and try to do some damage control with their money. 

Feb 24, 2007 12:46 pm

If the guy wasn't taking care of his clients and I desired a bigger book, I wouldn't have any problem cherry-picking through his best clients.  The concern is that he's probably got a lot of pissed-off clients...are these the type of people you want to work with?  If you can get them calmed down quickly, fine, but I have to wonder if you might be building a book of high-maintenance clients.

Feb 24, 2007 1:05 pm

I have never been a huge fan of inherited acoc**ts, but it sounds like there is true opportunity there. If the guy was indeed a HACk, it will give you a chance to position your services in a better light to the clients. Offer a full portfoilio review, make appropriate suggestions, and try to gather more assets or referrals. Referrals would be key since they may not hae been willing to refer their friends, etc to the departed rep.


At the end of the day- in business its war, and you have to do your best to retain these clients and develop the relationship.

Feb 24, 2007 5:11 pm

Sure, but what kind of people would work with an idiot like that?

Feb 24, 2007 5:58 pm

 I genuinely didn't like the guy's attitude and his clients have been WAY underserved for years...


So you were/are jealous of him.


Regardless of how you felt about the guy, that was HIS business that HE made over years of HIS hard work and good luck and good connections. Not YOURS and NOT the firm's.


Granted, the only reason you weren't calling his clients for years was that you worked at the same firm, and if you were at a different firm and you called one of his clients, then all would be fair.


But this is not that. You are not doing your work, you are doing the firm's dirty work. Your firm had let there be a chinese wall between you and he while he was there and now they take the wall down because he left, they share information that used to be confidential between him and them with third parties of their choosing.


Personally, I think that is unethical. When you switch doctors, does that give your ex doctor the right to go get anybody he wants about your embarassing medical issues? No. So why do we want the firm that (is supposed to) work(s) for us to go around sharing our professional secrets? (This concept of who works for whom is the central issue facing the industry today. IMHO)


You book belongs to you, not the firm!


Until we start treating ourselves and each other with the respect and professional courtesy that we deserve, we'll never be able to demand to be treated fairly by the upper managements of our firms.

Feb 24, 2007 5:59 pm

The proper course of action is to call the clients and say "...if you have questions or there is anyway that I can serve you, I'm here."



Feb 24, 2007 6:37 pm
Whomitmayconcer:

 I genuinely didn't like the guy's attitude and his clients have been WAY underserved for years...


So you were/are jealous of him.


Regardless of how you felt about the guy, that was HIS business that HE made over years of HIS hard work and good luck and good connections. Not YOURS and NOT the firm's.


Granted, the only reason you weren't calling his clients for years was that you worked at the same firm, and if you were at a different firm and you called one of his clients, then all would be fair.


But this is not that. You are not doing your work, you are doing the firm's dirty work. Your firm had let there be a chinese wall between you and he while he was there and now they take the wall down because he left, they share information that used to be confidential between him and them with third parties of their choosing.


Personally, I think that is unethical. When you switch doctors, does that give your ex doctor the right to go get anybody he wants about your embarassing medical issues? No. So why do we want the firm that (is supposed to) work(s) for us to go around sharing our professional secrets? (This concept of who works for whom is the central issue facing the industry today. IMHO)


You book belongs to you, not the firm!


Until we start treating ourselves and each other with the respect and professional courtesy that we deserve, we'll never be able to demand to be treated fairly by the upper managements of our firms.



Good points - although thinking that RRs are going to look out for each other is more far fetched than the tooth fairy.


What has truly surprised me is


1) The people who picked up the phone and basically said "I'm satying"


2) The people who are pissed I didn't call until he had been gone for 5 days.


No lie - the very first call was to a $4.8mm relationship that immediately said they would stay.


I genuinely didn't like the guy's attitude and his clients have been WAY underserved for years...


So you were/are jealous of him.


I get why you would say the jealousy thing (he did 2x the gross I did last year).  It's not the case.  I may have been envious of his production but that's it .  I was going to write that he was an a$$hole and a Dbag but I didn't think that was fair so I called it a bad attitude.  UNDERSERVED? - He had 950 households and 3000 accounts - I spoke to clients who had bonds mature and they would have to call him after they got their statements to re-invest.  I had more than one client call me to tell me they were staying...


Feb 24, 2007 10:18 pm

The book does not belong to you.  It belongs to the firm you are employed with.  Regardless of how the clients' were brought in.  Granted, the client can do whatever they wish, and move their $ with  whoever they choose.  Still, you are under contract with the firm you are with.  As you brought these client's in, you were an employee with "ABC Securities", acting on their behalf and being paid for it. Period.  The agreement is that you get a certain % on every dollar you produce.  The "firm" is custodian of the assets, market maker, risk acceptor, SIPC insured, etc etc etc.  It is what it is.  I'm not saying I wholeheartedly agree with it, by any means.  Yet if you leave, you should have every expectation that the firm you leave will take every step possible to try and retain those assets.  I hate the mudslinging, but "business is business." As any recruiter will tell you, you will likely bring 70-80% of the assets you want to bring over if you've done a good job. Still, this is not a business you "own".


Before all the indy's chime in on my above comments: no doubt you "own" to a larger degree the business you control.  In return you share more of the costs'/risks.  Not that it's necessarily a bad thing. 


Fellow reps- bottom line: the clients' are in control.  Always have been and always will be.  That's why our job is to bring in a as many qualified clients' as possible, and do the best possible job for them. 

Feb 24, 2007 11:32 pm

While you make a good point Judge, I don't think that it is the last word.


It's more like the wirehouse is the factory and you are Nike. When Nike moves its operations to a different factory, the first factory doesn't get to keep making Nikes. They can keep making sneakers, and they can try to sell those sneakers to the same distributors that sold Nikes (assuming they know who those distributors are and how to contact them). But you can't call them Nikes.


We only share information regarding our clients with the firm because we are mandated by law to do so. Was a time, you could sell bearer bonds to anyone, no questions asked. Because that became inconvenient to the government, rules were established that made this practice come to an end. If our clients could, they'd have numbered accounts with po boxes as the only address, and maybe a cell phone number on record. But they can't because WE can't.


Clients domicile shares at the firm because the firm makes it impractical for them to do otherwise, because the firm finds it uneconomical to do business any other way. We and our clients have been forced into this situation.


Instead they made this guy's job harder and harder. Didn't give him the support that would have helped him keep doing the things that he had done to become such a guy with 950 households. Instead they told everyone else he was a wart because he didn't like the way thing were being undone in this industry.


This guy and his clients paid their dues to this company every year! They bought and paid for those services that you rightly mentioned. But since they were paid for, the firm should have no claim to book that the man built while paying for every service the firm supplied him with (whether he needed/wanted/used them or not).


I don't know the guy, and he might well be a jerk. I do know that I've been hungry for "gone broker accounts" too (I didn't need to come here and ask for validation either), and I know that "everybody does it!" We are the stupidest bunch of smart people on the planet! There is no other group that could benefit as much as we from being unionized, and yet we won't. We think that since we buy stocks, we're supposed to be on the "side" of management. That would be fine if ever ONCE, management was actually on OUR side!


If there were an alliance of brokers, how do you think they'd negotiate with the firms in regards to book ownership? Right! The book belongs to the broker! The broker can do business where he wants and can leave when he wants and the firm has no right to interfere! What would happen then? The firms would start to work FOR the brokers. Their objective would be to create an environment where brokers would want to stay and do their work.

Feb 25, 2007 12:16 am

Excellent points/counterpoints here.  Bottom line is, if you take good care of your clients, they're yours.  If you don't, they're your former firm's.  I have a good relationship with the guy who replaced me at my old firm.  When I left, many clients followed and many stayed.  I knew they wouldn't all come.  For some, it wasn't an option (bank as trustee, etc.)  For others, it wasn't a good fit and I told them to stay where they were.  For a few, I either hadn't solidified the relationship (i.e., they hadn't been a client long enough) or the new rep had a relationship with the client (he was local also).


Looking back, I think we've for the most part treated each other with respect.  We both said a few things that we probably wouldn't have had we been working for the same team, but if you don't expect that any of that happens, you're pretty naive.  I don't hold any of that against him...he was doing his job and I was doing mine.  In the end, the clients decide and I'm well satisfied with the number who have come across (and are still coming).  Other than sending a few Christmas cards and advertising locally, I really didn't put forth any effort to bring them across.  For the first twelve months, I honored the non-solicit, even though I was advised that it wasn't valid.  By the time I got past the first twelve months, there really wasn't much of my old book that I was still interested in and I was plenty busy with new business.


There comes a point after you've left that you just need to write off the remaining part of your book that's stayed and move on...your time is better spent working on the new business that your clients are feeding you.  I've reached that point.  I don't turn down old clients that want to come across, but I don't waste any time chasing them either.

Feb 25, 2007 9:28 am

To add to this - I don't have the slightest bit of hesitation about going after the book .  I didn't start the thread to look for validation ;  I started it because I was thinking about how this is the first  time I have not had a single bit of remorse. I also know that when the time comes the shoe will be on the other foot.      The guy moved right across the street.  He can look out his window and see me sitting in the seat he occupied for 13 years.  He stood in front of our office on Wednesday morning and bad mouthed the firm, the process, how he was treated etc. to anyone who would listen (emloyees).  He offered a job to one of my colleagues (as a junior broker).  He cleaned the place out of office supplies, down to the last paper clip, post it, stapler etc..  telephone #s on the system are mysteriously incorrect, the voicemail system suddenly wont work and files are missing.  Now do you have an idea the type of guy we are talking about ?  This guy did over $1mm 7 out of those 13 years!  We are talking petty.


When he was standing in front of the office I congratulated him and told him to call me with the names of people he knew were staying and I would concentrate on them and back off the ones he wanted me to.  He basically laughed at me.  Last week I met / spoke with over $40mm that is staying.


I get the idea of a RR owning the book and I always looked at it that way - not this time.  These clients did business with him because he was the local guy in the bank.  These assets are part of the reason I give up 63% of my gross.  If we were Indy it would be completely different

Feb 25, 2007 12:31 pm

NoFX,


Fine, but please stop pretending that this is not something that it is.


You're in the eye of a shotstirm and you can't resist the urge tograb all that you can as it swirls in front of your eyes.


Wrong phone numbers on accounts! Heavens! No one ever did THAT before! In fact that what I was left handedly non referring to with the comment about only providing information because we were mandated to. How DARE this man make it difficult for the company to solicit his book of business! The Temerity! (I always wanted to coin the word "Limbaughsity" which would be the word that indicates that one is using the word "Temerity" sarcastically. And now I have.)


He took every scrap of paper? Good for him! He thought this process out and did it right (although the standing in front of the office seems a bit "Not economically viable" from Falling Down)


Nothing is going to convince you otherwise, except time.

Feb 25, 2007 1:23 pm
Whomitmayconcer:

NoFX,


Fine, but please stop pretending that this is not something that it is.


You're in the eye of a shotstirm and you can't resist the urge tograb all that you can as it swirls in front of your eyes.


Wrong phone numbers on accounts! Heavens! No one ever did THAT before! In fact that what I was left handedly non referring to with the comment about only providing information because we were mandated to. How DARE this man make it difficult for the company to solicit his book of business! The Temerity! (I always wanted to coin the word "Limbaughsity" which would be the word that indicates that one is using the word "Temerity" sarcastically. And now I have.)


He took every scrap of paper? Good for him! He thought this process out and did it right (although the standing in front of the office seems a bit "Not economically viable" from Falling Down)


Nothing is going to convince you otherwise, except time.



I'm NOT pretending. You are accurate on all accounts.

Feb 25, 2007 2:00 pm

You seem a good guy NOFX!


Feb 25, 2007 11:44 pm
Whomitmayconcer:

If there were an alliance of brokers, how do you think they'd negotiate with the firms in regards to book ownership? Right! The book belongs to the broker! The broker can do business where he wants and can leave when he wants and the firm has no right to interfere! What would happen then? The firms would start to work FOR the brokers. Their objective would be to create an environment where brokers would want to stay and do their work.



Does anyone else see the irony here that he is basically describing the business model of an indy b/d?

Feb 26, 2007 10:54 am

Would you be indy if a major wirehouse adopted the Indy b/d paradigm (Probably better to ask, if ALL wires adopted it)?

Feb 26, 2007 2:19 pm
Whomitmayconcer:

Would you be indy if a major wirehouse adopted the Indy b/d paradigm (Probably better to ask, if ALL wires adopted it)?



Probably not.

Why should I trust them?  They would likely start grabbing at a bigger slice of my revenues every time they had a chance.  They can't help themselves.  It's in their corporate DNA.

Why would I go with someone who is new to the game when the established indys have been working this business model successfully for decades?

Feb 26, 2007 3:00 pm

Dude!


The game is call "WHAT IF". Not "Why It'll Never Be That Way."


IFF (if and only if) a major wirehouse adopted the Indy b/d paradigm (and assumimng that they meant it and that their vested interest was not to nickle and dime you to death because you are always free to leave without interference for the firm) would you join?


Don't be a dick, answer the question hypothetically.

Feb 26, 2007 6:37 pm

There is no other group that could benefit as much as we from being unionized, and yet we won't. We think that since we buy stocks, we're supposed to be on the "side" of management. That would be fine if ever ONCE, management was actually on OUR side!


You must mean a figurative union, not a real, potentiallly corrupt union.


Like Indy says, if you take good care of clients, they're yours.


I think independent b/ds put good pressure on branded b/ds, and offer a nice option.


But branding can be good - I got two new clients in the last week just by picking up the phone and servicing the brand. No chasing here - from client's point of view, us acting professional is the key.


I like to think of our "union" as being the Financial Planning Association, or even the Registered Rep site. Focusing on our differences, eg. registered rep vs. registered investment advisor, Jones vs. indy, fee-based vs. commissioned - we might even be victims of this mentality. After all, when moves in this business, it gets made. We should focus more on our common professional attributes.