Deutsche Bank has sued some of its former wealth management staff to prevent them from joining a rival firm HPM Partners in the US, Bloomberg reports.
Deutsche Bank has sued some of its former wealth management staff to prevent them from joining a rival firm, HPM Partners, in the US, this publication can confirm. Two of the persons claim they were forced to leave the bank after being put under pressure to sell products that were unsuitable for clients.
Germany’s largest bank has accused HPM, a New York-based investment advisor, of inducing more than a dozen members of its asset and wealth-management division to leave and “to bring with them DB’s most valuable key clients”, according to a complaint filed this week in a state court in Manhattan.
The hirings violated a non-solicitation agreement and previous settlement over HPM’s recruitment of Deutsche Bank employees in 2012, the bank alleges.
“The unlawful actions by HPM and the employee defendants could best be described as an economic coup d’etat, which seeks to obtain DB’s critical client base as its spoils,” Deutsche Bank said in the complaint.
Benjamin Pace and Lawrence Weissman, who both resigned 16 May and were named in the lawsuit, filed a counter-suit claiming they were compelled to leave and pressured to invest clients’ money in the bank’s high-margin, proprietary products, which weren’t in their customers’ best interest, the report said.
A spokesperson for Deutsche told this publication: “Deutsche Asset and Wealth Management’s first priority is to fulfill fiduciary duties owed to clients and we reject the claims made in this complaint."
It is understood that this is not the first time that Deutsche has locked horns with HPM over client solicitation allegations.