Merrill Broker in N.J. Agrees to Customer Solicitation Ban
A former bank-based broker with JPMorgan Chase & Co. has agreed not to solicit his former clients to join him at his new Merrill Lynch office, according to a stipulated preliminary injunction filed in federal court in New Jersey.
Bale’s lawyer, Louis M. Lagalante in New York, did not return a call for comment. Bale, who had worked at Chase branches since 2011, could not immediately be reached for comment at his office in Montvale, N.J.
J.P. Morgan Securities, the bank’s broker-dealer, sued Bale for allegedly transferring $4.3 million of his customers’ assets to Merrill in the two weeks after his move, according to its initial complaint. Bale had been managing about $143 million for 352 clients when he left the bank.
The case reflects the increasingly protective stance that lawyers say large banks have been taking as wirehouses and other broker-dealers have been more frequently targeting their in-branch sales force, lawyers said.
JPMorgan has gone to court to enforce non-solicitation agreements against at least two other bank-based brokers and private bankers recruited by Merrill in recent years. A former Chase bank broker similarly agreed to a TRO in October 2018, while JPMorgan also sued a former Private Bank team in April that year.
A Merrill spokesperson declined to comment.
J.P. Morgan Securities and Merrill are members of the Protocol for Broker Recruiting, which allows brokers to take limited client contact information when joining signatory firms. But JPMorgan has excluded bank branch brokers from the pact’s protections (which it grants to the cadre of around 475 brokers in its legacy Bear Stearns unit).
Merrill, which is owned by Bank of America, remains in the Protocol despite withdrawing from veteran broker recruiting in 2017. It has instead relied on internal training programs and hiring of novice or non-traditional hires.
In January, it recruited two other J.P. Morgan brokers in Texas.
Bale first registered as a securities sales representative in 2011 with Merrill Lynch, according to his BrokerCheck history, but joined J.P. Morgan and its Chase Investment Services broker-dealer after nine months at his former firm.
The stipulated injunction did not specify how many clients would be excluded from its non-solicitation mandate, but JPMorgan had previously said in a dig on his sales chops that Bale did not bring any clients with him from Merrill.