A former sergeant in the Marine Corps Reserves — and member of the U.S. force that invaded Iraq in 2003 — filed suit Friday against Wells Fargo Advisors.
Jay Belanger, who had worked as a registered representative for Prudential Securities Inc. before going to Iraq, says the firm (now part of Wells Fargo Advisors) gave away his customers to other reps while he was on military duty. He also claims the company told him he should resign from the brokerage side of the house.
Prior to shipping out to Iraq, Mr. Belanger had a book of business that, at the top of the bull market in 2000, included 150 accounts and $11 million in assets, earning him an income of about $100,000. He claims the firm — Prudential Securities merged with Wachovia Securities while he was on active duty — offered him a position as a broker in a Wachovia bank branch when he returned to the States. That job, he claims, offered an annual salary of $44,000 and minimal commissions. He worked in the job for a few months before resigning.
Mr. Belanger, who was wounded in an attack on a desert highway southwest of Baghdad, alleges that Wachovia Securities LLC, its successor Wells Fargo Advisors LLC, and predecessor, Prudential Securities, violated his rights under the Uniformed Services Employment and Reemployment Rights Act of 1994.
That law requires employers to protect employees' careers while they are on active military duty. Mr. Belanger's suit claims that Wachovia and its related firms “systematically destroyed his client base and book of business.”
It is the second time this year that Wachovia is confronting charges that it violated the law and harmed the livelihoods of registered reps when they returned from serving in the military.
In March, veteran and broker Michael Serricchio won close to $1 million in back pay, damages and legal fees from Wachovia in federal court in Connecticut.
Teresa Dougherty, a Wells Fargo Advisors spokeswoman, said the firm would not comment on pending litigation. She added, however, that Wachovia Securitieshad been recognized by the Defense Department for its exemplary treatment of military personnel.
Mr. Belanger and Mr. Serricchio are not alone in their post-service experiences, according to one lawyer who specializes in USERRA claims. He said the securities industry has violated the rights of many brokers and bankers who have returned home from active military duty.
“This is not something that's unusual,” said Mat Tully, founding partner with Tully Rinckey PLLC. He said his firm is working on “200 active cases” involving Wall Street firms.
Part of the problem has to do with the nature of the brokerage industry, Mr. Tully said. When a rep leaves for military service, his clients are handed off to other brokers to tend and maintain until the rep returns. Still, some clients don't like moving back and forth between brokers, Mr. Tully said. “When you come back from war, how do you reconstruct the book of business?”
Mr. Belanger, who remained in the business and is currently affiliated with LPL Financial Corp., uses a hearing aid after suffering permanent hearing loss in Iraq.
He declined to be interviewed for this story.
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