Non Compete

I have a question about non compete agreements. Say a large advisor and his assistant leave a firm. The CEO ensures that he does so quietly without tipping off clients. The clients call in wondering where “Joey” is? When they realize he is no longer there, they call his cell phone since he had that number on his email signature line while he worked at the company. Would this firm have recourse against this? Second, what if a client asks where this advisor went and the person at the firm told them where he went. Is giving this factual information against CFAI ethics and non compete agreements?

Remember, the noncompete is really a promise a candidate makes to not solicit clients from the previous company for a certain amount of time. It doesnt say anything about the client soliciting for an advisor. Theres nothing wrong with a client calling the cellphone of the candidate and asking for details. As long as you dont solicit, or use company directories to solicit business, its fine. There is no violation. Your second part. well… think about it… would you want past clients (even the crappy ones) to ask for your number and then be able to get it from your previous employer? Wouldnt be very fair. This is more of a privacy and confidentiality matter. if the employer is trying to follow CFAI regulations, he would not give out this information to your old client. he can however ask said client if he would like to have his number forwarded to the previous employee. Can i get a second opinion?

ditchdigger - do you have a problem with non-competes? If so, drop me a line at joeydvivre at yahoo dot com

I do not. This was accidentally posted in L1 and I could not delete it when I realized the mistake. I apologize about the redundancy with L1 and General Discussion. This is a real scenario about some individuals leaving a firm we work with. The person leaving is very talented and we have a feeling most clients will seek him out. I work in ops and do not have the details of the non compete that is in place for him. Another way to put it, is there a way for the firm to keep clients from voluntarily seeking this advisor out?

ditchdigger - You really want to just stay out of this. What goes around, comes around and one day you too will be leaving the firm. You do not want to be supporting the firm’s position on non-compete/non-solicitation agreements.

I’m only curious ;-). I’m not getting involved in any degree to this.