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Monday, May 27, 2024 | Back issues
Courthouse News Service Courthouse News Service

Securities Brokers Wage Hiring War

(CN) - A London-based firm that matches securities trades between banks filed a RICO complaint against a longtime rival it accuses of poaching senior-level employees on a "global scale" to try to cripple its business. Tullett Prebon PLC sued BGC Partners in Newark Federal Court.

Tullett Prebon said the raids, which have been going on since 2005, have caused enormous harm to its business and reputation. It seeks $1 billion damages, an injunction barring any more raids, and barring BGC from employing the employees it hired away.

Tullett Prebon claims BGC began by stripping its Singapore-based affiliate of 55 brokers, about half of Tullett's brokerage staff. Then it embarked on similar raids of Tullett's London, Tokyo and Hong Kong offices, luring away another 28 employees, Tullett says.

"BGC's latest maneuver involves raiding 81 brokers from Tullet's New York and New Jersey offices in August and September if this year," the complaint states. "BGC waited until the end of summer to carry out its raid - after the employees' bonuses were paid out and during a time when the largest number of senior executives were away on vacation. Clearly, its scheme was meticulously designed to destabilize Tullet's work force."

In executing its raids, BGC gained the cooperation of desk heads and other senior-level employees with promises of "extraordinary compensation packages" and other "broad indemnities," inducing them to provide BGC with Tullett's confidential information about productivity, salary and bonus figures for the targeted employees, the complaint states.

These corrupted desk heads and senior executives then acted as "recruiting sergeants," reaching out to the desired employees through secret letters, telephone calls, emails and text messages, according to the complaint.

As part of the scheme, many workers were lied to, told that they were about to be caught up in a corporate downsizing or that their bonuses are about to be cut, the complaint adds.

Tullett said the raids are carried out in waves, with the most productive brokers targeted first, followed by successive waves that sweep up lower-producing and more junior brokers.

The charges are similar to complaints Tullett filed previously with the Financial Industry Regulatory Authority in Washington, and the High Court in London.

Tullett Prebon is represented by Joseph Boyle with Kelley Drye & Warren of Parsippany, N.J.

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