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Serious Problem

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Dodah View Drop Down
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    Posted: Jul/27/2014 at 10:54am
Sorry if I'm posting in the wrong spot but I need advice in a hurry.

I'm currently contemplating seperation from my current bd and working arrangement (in an office owned by an advisor where I am paid a small percentage of production while producing at respectable levels (250 rolling 12, 150 ytd). 

The issue is this:  I recently discovered what I believe to be a serious breach of duty with respect to privacy of data.  I found boxes and boxes of records in an unlocked outdoor storage shed.  Of course my clients' data is likely in there as well as others.  We're talking about account numbers, full names, birth dates, social security numbers phone numbers, account balances, signatures, copies of tax returns etc.

So here's the twist:  I am attempting to move my practice and believe the guy I work "for" (the OSJ), will hold a grudge, try to keep me from succeeding, threaten me with something; who knows, he's a loose cannon.  I could go directly to my current BD, but given that its the office I work in, any action they might take against the guy I work for would result in a negative impact to my practice right in the middle of trying to make a move to a new BD!

I took a 3rd party witness to the location after purchasing a lock and had him as a witness to both the unlocked shed and the fact that within 24 hours of discovery, I was securing the records.  (he's a badge carrying fed...we'll leave it at that for the time being).

When I finally have the discussion with the OSJ telling him I'm leaving, I have tremendous leverage...but the fact of the matter is this:  even if I leave, the records of my clients are included with the heap of other records still out there in that little tin shed; lock or no lock, I really don't think that's where they should be nor do I believe that any regulatory board or supervisory board would approve. 

Do I blow the whistle?  Do I contact the current BD?  thoughts? 
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Post Options Post Options   Thanks (0) Thanks(0)   Quote Guests Quote  Post ReplyReply Direct Link To This Post Posted: Jul/27/2014 at 11:00am
Are you leaving the b/d because of your OSJ, or because you found a b/d you like better?
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Post Options Post Options   Thanks (0) Thanks(0)   Quote yield spread Quote  Post ReplyReply Direct Link To This Post Posted: Jul/27/2014 at 11:12am
You wait until Labor day weekend.
You work on repapering- meaning have all the clients who will go with you sign the new forms.

On Friday your new firm will submit the acats, the market is closed on Monday and they won't have until Tuesday to try to keep your clients.  

In the meantime, say and do nothing that gives them any indication you're less then happy.

Your new firm should be telling you all of this.
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Post Options Post Options   Thanks (0) Thanks(0)   Quote Sportsfreak Quote  Post ReplyReply Direct Link To This Post Posted: Jul/27/2014 at 11:21am
1. How big is your OSJ, as a producer. That will influence how your B/D reacts and handles the situation. With that said, any respected, compliant B/D will consider this data in unsecured location, a major breach of the rules, and if you give it to them in writing (email) they may have no choice but to act. 
2. What is your agreement with the OSJ, and with the B/D?
It would be way easier for you to set up on your own (if the b/d will let you own your own branch at your level of production) and avoid repapering. Some B/D's will also not allow you to leave the branch and stay with the B/D (either under another OSJ, or as your own branch) unless the current OSJ agrees. You may also have an agreement with your current OSJ that restricts where you can set up (say,  mile radius, whatever), and what you can take.

Like Helado said, or implied, if your REAL issue, if you were being truthful with yourself, is that you want to change b/d's then thats another story.




If you eat an entire cake without cutting it, then technically, you only had one piece
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Dodah View Drop Down
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Post Options Post Options   Thanks (0) Thanks(0)   Quote Dodah Quote  Post ReplyReply Direct Link To This Post Posted: Jul/27/2014 at 12:55pm
I am definitely leaving the BD.  I've found a new BD after an extensive search, visits, etc.  More supportive, fewer product restrictions, less expensive.  There are no non-compete agreements, no restrictions on my book currently.  I like the long weekend approach!  Very helpful for the timing issue. 
The struggle that I have is what if anything I say and to whom to report the security breach.  I'm inclined to hold the info in my back pocket until after the transition, then bring it to the attention of whomever I need to in order to a) make sure the data is safe and b) the OSJ is made aware of the importance of security.
 
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Post Options Post Options   Thanks (0) Thanks(0)   Quote Sportsfreak Quote  Post ReplyReply Direct Link To This Post Posted: Jul/27/2014 at 12:59pm
Just make the move, as was said, on Labor Day, and tell the OSJ if he fucks with you in any way shape or form, you will pin his ass to the wall by advising the B/D that the reason you left is that you felt the OSJ was not securing your clients data properly.
If you eat an entire cake without cutting it, then technically, you only had one piece
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Post Options Post Options   Thanks (0) Thanks(0)   Quote Jagger Quote  Post ReplyReply Direct Link To This Post Posted: Jul/27/2014 at 5:19pm
Originally posted by yield spread yield spread wrote:

You wait until Labor day weekend.
You work on repapering- meaning have all the clients who will go with you sign the new forms.

On Friday your new firm will submit the acats, the market is closed on Monday and they won't have until Tuesday to try to keep your clients.  

In the meantime, say and do nothing that gives them any indication you're less then happy.

Your new firm should be telling you all of this.


I heard that somewhere.... MADMEN LOL
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Post Options Post Options   Thanks (0) Thanks(0)   Quote yield spread Quote  Post ReplyReply Direct Link To This Post Posted: Jul/27/2014 at 6:21pm
What you call a serious problem, I call a serious opportunity.

I would have every account and all of its holdings on file.
2 years later I would attack.

If you can't access it electronically, go in the shed on a sunday and start taking pictures.

Its shitty and ethically wrong, just like every bank and firm on wall street.
They just write checks to the DOJ to settle.



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Post Options Post Options   Thanks (0) Thanks(0)   Quote Dodah Quote  Post ReplyReply Direct Link To This Post Posted: Jul/28/2014 at 8:08am
LABOR DAY IS D DAY!  Thanks for the great advice.   I've taken video and had a witness go with me to lock the shed (retaining the keys and the dated receipt for the lock just in case I need proof).

I assume that from Friday at 4:59pm through the weekend is when I'll be contacting all my clients with the news of my move, contact info, etc; along with hosting info sessions at my office the following week for clients to sign change of broker paperwork. 

So looking forward to "the other side"!!!
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Post Options Post Options   Thanks (0) Thanks(0)   Quote Guests Quote  Post ReplyReply Direct Link To This Post Posted: Jul/28/2014 at 9:36am
I'd consider telling the osj about the security or lack thereof. Then let him know you have evidence and witnesses. Tell him you are leaving for that reason and you expect no hard feelings and no attempt to keep your clients...and if it goes that way, you'll keep what you know to yourself.

Edited by helado - Jul/28/2014 at 9:36am
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Post Options Post Options   Thanks (0) Thanks(0)   Quote Sportsfreak Quote  Post ReplyReply Direct Link To This Post Posted: Jul/28/2014 at 8:42pm

Originally posted by helado helado wrote:

I'd consider telling the osj about the security or lack thereof. Then let him know you have evidence and witnesses. Tell him you are leaving for that reason and you expect no hard feelings and no attempt to keep your clients...and if it goes that way, you'll keep what you know to yourself.

Thats what i said.

Originally posted by Sportsfreak Sportsfreak wrote:

Just make the move, as was said, on Labor Day, and tell the OSJ if he fucks with you in any way shape or form, you will pin his ass to the wall by advising the B/D that the reason you left is that you felt the OSJ was not securing your clients data properly.
If you eat an entire cake without cutting it, then technically, you only had one piece
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Post Options Post Options   Thanks (0) Thanks(0)   Quote Guests Quote  Post ReplyReply Direct Link To This Post Posted: Jul/28/2014 at 10:49pm
Sorry i thought you would be too busy revamping your fee schedule to address this.
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