Thursday, February 18, 2010, 2:17 PM

Goldman Sachs Alleges Credit Suisse Picked Its Pocket in Atlanta

By Todd

Reuters is reporting that Goldman Sachs has sued seven former wealth managers for allegedly soliciting an en masse departure of employees and clients. Goldman has also reportedly sued Credit Suisse for inducing the departures with oodles of up front departure bonus cash.

The seven immediately began "pirating" Goldman clients and colleagues to join them at Credit Suisse, according to the suit, filed in federal court in Atlanta on Wednesday. The seven violated their non-solicitation agreements and stole confidential information, the suit said.

Credit Suisse and Goldman declined to comment on the matter.

Goldman's lawsuit comes amid heated competition among the largest U.S. wealth management firms to poach advisers and their customers.

Credit Suisse's Americas private banking head told Reuters earlier this month that he wants to grow the U.S. wealth management business from 400 advisers to 700 over the next few years.

According to the Goldman lawsuit, one of the seven defectors, David Greene, told Goldman Atlanta office head David Fox that Credit Suisse agreed to pay him $11 million to join the firm.

The seven began soliciting Goldman's clients and employees on Feb. 6, a day after they resigned from Goldman, according to the suit.

Greene called Goldman Sachs Vice President Justin Berman on Feb. 8 at 6:15 a.m. and offered him $10 million to join Credit Suisse, the suit said.

Goldman also accused the defectors of telling Goldman clients that the defections had "destabilized" the Atlanta office, which is in the same building as Credit Suisse's wealth managers.

Goldman's Atlanta team advised 140 Goldman clients in several Southeast states, according to the filing.

The suit alleges that the departing advisers attempted to skirt non-solicitation agreements by having Dennard and Tyson -- who did not sign such agreements -- call former clients on behalf of the team. Clients were asked to contact Goldman advisers who were moving to Credit Suisse, the suit said.

The departing executives also targeted Goldman's internal list of potential wealth management clients, another violation of their employment agreements, Goldman said. The New York bank draws attention to a similar wave of defections that hit Credit Suisse in 2007 , and says “It is beyond ironic that Credit Suisse having been so damaged by the departure of its key private wealth asset managers in October 2007 has similarly preyed on Goldman Sachs.”

Goldman asked the court to restrain the seven defectors from using Goldman information and order them to return documents.

The case is captioned In re: Goldman, Sachs & Co. v. Greene et al, U.S. District Court, Northern District of Georgia, No. 1:10-cv-00453.


Blogger shika said...

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