After Strange Dismissal, Morgan Stanley Star Alights at Merrill Lynch
It’s rare in these days of compliance hyper-sensitivity for a brokerage firm to roll out the welcome mat for an advisor terminated by a rival, but Merrill Lynch appears to have made an exception for the leader of a high-producing team in San Francisco.
Merrill hired Daniella Rand and all but one member of her multi-million-dollar team on April 7, a month after she was fired by Morgan Stanley, according to her Financial Industry Regulatory Authority BrokerCheck report. Morgan Stanley discharged her on March 6 for “misuse of telephone caller identification information in a call to a client” and providing “incomplete and inaccurate information” during an internal review, according to Finra.
A spokeswoman at Morgan Stanley declined to elaborate on the unusual allegation or on any aspect of the Rand Group’s departure.
Rand’s title of managing director at her former and current firms suggests that the team, co-founded by David Harrison-Rand, are big producers. The title, which Morgan Stanley bestowed on her in 2015, required at least $8.8 million of production over three consecutive years, according to the firm’s compensation plan that year.
Rand, who had spent her entire career at Morgan Stanley beginning in 2001, said in a brief interview that she believed the descriptions Morgan Stanley left on her BrokerCheck are “materially incomplete or misleading as written.”
She and her lawyer are trying to amend the language, she said, but declined to elaborate on whether she has filed or may file an expungement or other arbitration request.
A source at Merrill familiar with its regulatory regimes, said the firm conducted proper pre-hire due-diligence on the Rands and the four client associates who moved with them. (Patrick Taylor, a wealth management associate and group director who remains at Morgan Stanley, declined to comment.)
“Despite the risk she’d still be an attractive hire,” said George C. Miller, a San Diego-based employment lawyer who said he is not familiar with Rand’s situation. “Somebody who has that level of production likely has a nearly billion-dollar book of business, and there is intense competition for those clients and assets.”
Firms have been tightening their vetting of new hires, creating a tension between compliance officials and traditional managers who have historically found it easy to get the go-ahead for hiring new producers.
In its 2017 examination priorities notice, Finra highlighted hiring practices and reviews of supervisory mechanisms for brokers with prior disclosure events as a top item. Rand, to be sure, has a clean brokerage record outside of the March 6 termination.