FINRA Arbitration Results in Rare Ruling against Employer
Saturday, December, 5, 2015
FINRA arbitration panels are notorious for siding the advisement firm against advisors, but one recent case bucked this trend. JPMorgan has been ordered to pay $350,000 in compensation to Kostantina Bourdev after she was wrongfully terminated by the company. JPMorgan was also accused of defamation.
Bourdev was terminated from JPMorgan in September 2013 after an internal investigation by the company revealed an unnamed advisor misrepresented the risks and returns of several products in meetings with clients. According to JPMorgan, Bourdev frequently participated in these presentations. The unnamed advisor was terminated, as was Bourdev following the investigation.
JPMorgan then claimed Bourdev’s participation in these presentations made her obligated to report violations committed by that advisor to her supervisors. In addition to her firing, the company changed her U-5 to reflect the firm’s findings of her presence at the meetings. U-5 is the termination notice filed with regulators that others have access to view. It affects a person’s standing and credibility in the industry.
Bourdev’s attorney called the ruling in his client’s favor a “David vs. Goliath situation.” It will now have to compensate the former employer and expunge her termination record, replacing it with a statement that FINRA found the company’s investigation deficient.
Bourdev still struggles to find work as an advisor and is currently working at Ameriprise in operations, making half the salary she was while at JPMorgan. Those familiar with the case are hopeful this ends the trend of FINRA’s tendency to side with the firm instead of the individual in similar cases, but many are skeptical.