A FINRA arbitration panel has ordered a former SunTrust broker to give back the bulk of his $675,000 signing bonus.
Nicholas MacNab, who worked for SunTrust Investment Services in Atlanta, was asked to return the money within months of joining the firm in February 2014. He had previously been with BB&T Investments.
Three weeks after joining SunTrust, MacNab claimed he was having a psychological breakdown due to an order he received from BB&T to stop soliciting his former clients, according to SunTrust's lawyer, Andrew Froman of Florida law firm Fisher & Phillips.
The firm granted him a 60-day unpaid leave of absence and when he failed to return to work, the firm sought recovery of the bonus, Froman said.
SunTrust had given him an upfront signing bonus of $625,000, plus an early asset transfer bonus of $50,000, which is typically granted six months after an adviser joins the firm, according to Froman.
MacNab argued that his offer letter stipulated that he wouldn't have to repay the bonus if he became disabled, an argument that SunTrust said didn't hold water because he hadn't been there long enough to qualify for the firm's long-term disability plan.
"The fact that he's unable to do his duties and is being treated by a physician is insufficient," Froman said.
MacNab's attorney, Jeffrey Barnes of Atlanta, argued that was nonsense. "Nowhere does it say that he has to qualify for the long-term disability claim," he said. "He needs to be disabled as defined by the plan."
At the hearing, MacNab called his wife, from whom he is separated, to testify about "how emotionally distraught he was over the whole thing," according to Froman.
MacNab also claimed that SunTrust's hiring manager, John Charles Cote, fraudulently induced him to accept the offer and that SunTrust didn't support him as promised when he ran into issues with BB&T.
SunTrust disputed the claim, saying that Cote cautioned MacNab not to violate any non-solicitation or non-compete agreement with his former employer.
SunTrust alleged that MacNab never told the firm he had a non-compete agreement, a claim that MacNab denied.
At the hearing, MacNab testified that Cote told him that non-compete and non-solicitation agreements are not enforceable and that they're not enforced in the industry anyway.
"Cote never said any of that to him," Froman said.
The panel ordered MacNab to pay SunTrust $647,706 in compensatory damages, plus 7% interest annually on the amount from July 1, 2014 to April 19, 2017.
"Had the arbitrators actually done what they should have done, the bonus would have been waived," Barnes said.
MacNab was with SunTrust from February 2014 to June 2014, according to BrokerCheck records.
"Nick ends up with his career destroyed and he lost all of his clients," Barnes said.
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