A former senior financial adviser at First Citizens Bank who contended that she was unjustly fired on a “trumped-up, fraudulent and fabricated charge” has been awarded nearly $1 million in damages by a panel of arbitrators.
Elizabeth Stancil, a Clayton resident, was awarded $985,000 in compensatory damages in a unanimous May 20 ruling by a three-person panel of arbitrators for the Financial Industry Regulatory Authority, or FINRA, which regulates brokerage firms. Stancil worked in Smithfield for First Citizens Investor Services, a subsidiary of Raleigh-based First Citizens Bank.
Stancil’s attorney, Andrew Whiteman of Raleigh, said his client felt vindicated by the victory after First Citizens fought “tooth and nail” against her.
That vindication “was almost more important than the money, in my opinion, but the money is nice,” he said.
First Citizens had disputed any wrongdoing and argued that Stancil’s claims were “baseless.”
“We strongly disagree with the panel’s decision but, given the limited options for appeal in a FINRA arbitration, we’re putting the matter behind us,” said bank spokeswoman Barbara Thompson.
The terse ruling doesn’t include the arbitrators’ rationale for the decision or for determining the amount of Stancil’s award.
Stancil, who had been with First Citizens for 13 years and ranked among its top producing financial advisers, was dismissed in March 2014. The bank contended that she was dismissed for paying two assistants a total of $9,000 in unauthorized bonuses out of her own pocket in violation of the bank’s code of ethics and industry regulations.
Stancil countered that the bonus program had been approved in advance by two of her supervisors and noted that FINRA took no action regarding the bonuses following an investigation. She contended in her complaint that “the only rational conclusion” to draw from First Citizens’ action was that it was part of a calculated campaign to fire her, “smear her good name, and reassign her client base to new and less-costly” financial advisors employed by the bank.
First Citizens argued that there was no evidence that any supervisors had approved the bonus plan, nor was there any evidence to support her “conspiracy theory.” It also argued that, because Stancil was an at-will employee, the bank had the right to terminate her employment “at any time for any reason or no reason.”
The arbitrators’ ruling also found that Stancil’s Form U-5 filed by First Citizens – a form that must be filed whenever a FINRA-registered financial adviser leaves a firm for any reason – was defamatory. They recommended that it be changed to reflect that she was “terminated without just cause.”
The U-5 filed by First Citizens reported that her employment was terminated for violating the bank’s code of ethic.
“A negative U-5 filing,” case documents filed by Stancil declared, “often impedes a terminated broker’s efforts to seek new employment, to obtain regulatory approvals necessary to continue in business, and to retain customers.”
Stancil, however, found a job as a senior financial adviser with Wells Fargo Advisors in Cary shortly after she was dismissed by First Citizens. Through her attorney she declined to comment on her arbitration award, citing Wells Fargo’s rules regarding communicating with the media.
Stancil didn’t win everything she sought. The award she received was well below the $15.8 million in compensatory damages that she claimed; in addition, she also sought, but failed to obtain, punitive damages and attorney’s fees.
The compensatory damages sought by Stancil, 39, were based on an estimate of her reduced earnings during her lifetime as a result of being fired by First Citizens and separated from her client base.
“Unfortunately,” the brief stated, “Ms. Stancil’s loss of income likely will continue for the remainder of her career.”
In 2013, her final year at First Citizens, Stancil generated more than $1 million in commissions income for the bank and received $334,000 in compensation. In 2015 at Wells Fargo she generated $207,384 in income for the bank and earned $66,860, according to her brief.
Whiteman, her attorney, said he could only speculate why the arbitrators didn’t award her more money.
“We have no idea why the arbitrators came up with the number they did,” he said.