Merrill Ousts Three Southwest Brokers over Cold-Calling
Three brokers who spent their entire careers with Merrill Lynch have left the firm following allegations of improperly soliciting prospects in violation of firm policy, according to their BrokerCheck records.
Johnathan Rankin, a 12-year Thundering Herder who was Bendell’s Dallas-based senior partner, was allowed to “voluntarily” resign over the same solicitation and failure-to-cooperate allegations, according to his BrokerCheck history.
Rankin, who a month ago joined independent broker and advisory firm Sanctuary Wealth Services, did not return a request for comment. Elliott and Bendell are not currently registered as brokers or investment advisers, and did not return calls for comment to their home numbers.
A Merrill source said that at least two of the brokers had been warned about their cold-calling techniques. While the sales practice has generally fallen out of favor, it is permitted at most firms if contact lists are run through compliance to ensure that current clients aren’t solicited and that brokers refrain from calling people on the Federal Trade Commission’s Do Not Call registry.
It could not be determined if any of the advisors resorted to cold-calling to meet household-account growth requirements that Merrill Lynch Wealth Management instituted two years ago, though the source said Rankin and Bendell were touted locally in internal emails for hitting growth metrics. Another source said Merrill was so pleased with the recent growth of Rankin’s book that it delegated him to make presentations to other advisors nation-wide.
The new growth grid adds, subtracts or keeps constant the percentage points determining advisors’ payout on the firm’s standard grid.
A Merrill spokesman declined to comment on the brokers’ growth performance numbers.
The Financial Industry Regulatory Authority and state regulators have imposed penalties on firms related to cold-calling. New Hampshire fined Merrill Lynch $400,000 in 2014 for improperly calling prospects in the state who had registered on the Do Not Call lists. Finra in August fined a small Boca Raton broker-dealer $20,000 for calling 49 prohibited numbers.
Rankin and Bendell managed $129 million of customer assets as of September 4, according to Forbes 2019 “Best-in-State” brokers in Arizona, which listed Rankin as #18 in the state. In addition to being a producer, he served as a sales manager in Dallas for Merrill, according to his LinkedIn profile. He joined Sanctuary, which was founded by former Merrill regional manager Jim Dickson, on October 14, according to BrokerCheck.
The Peoria office that Elliott ran is part of Merrill’s Scottsdale Sun City market, whose manager Eileen Elliott is believed to have stepped down last week. The Elliotts are not related, according to the two sources. The Peoria branch had 16 brokers, according to Elliott’s LinkedIn profile.
-Vicky Ge Huang contributed reporting.