A FINRA arbitration panel handed a former Ameriprise advisor a major victory this week, awarding her $200,000 and ordering her official record cleared in a defamation suit against her former employer.
Brooke Pilant, a Tennessee-based advisor at Ameriprise from 2017 to 2024, filed a complaint last year with the Financial Industry Regulatory Authority accusing her former firm and three then-employees of defamation, intentional misrepresentation, tortious interference and breaching a settlement agreement. According to the official arbitration award, Pilant accused Ameriprise and the three employees of defaming her after she had raised "concerns about unethical practices within Ameriprise."
"Ameriprise turned against her, attempting to undermine her credibility, while jeopardizing her career," according to the FINRA arbitration panel's summary of her complaint.
Pilant's lawyer, Victor Hayslip of Burr & Forman in Birmingham, Alabama, said Pilant had raised concerns about a "double standard for how people were treated" in the office where she worked under an advisor named William Maclin. Maclin was at Ameriprise from 1993 until this year but is
Hayslip declined to elaborate on Pilant's specific allegations. He said her defamation claim involved the language Ameriprise used in the Form U5 filing it was required to submit to FINRA explaining the reasons for her separation from the firm.
"We think this is a testament to that fact that Brooke's fears about what was transpiring at Ameriprise actually did happen," Hayslip said. "We're glad that this is over, and it should have never gotten this far."
Hayslip said Pilant had previously reached a legal settlement with Maclin.
Ameriprise said in a statement that it disagrees with certain aspects of the arbitration panel's decision, without elaborating on which ones, and said that Pilant was an employee of an independent financial advisor.
"Ameriprise remains committed to fostering a culture of integrity, professionalism and respect," Ameriprise said. "We also take our regulatory reporting responsibilities seriously."
Of the two other people named in Pilant's complaint — George Varones and Jennifer Schuster — Varones is also no longer at the firm. Varones, who had been a franchise field vice president in Nashville, left last year to become a senior lead business growth strategy consultant-executive director at Wells Fargo, according to his LinkedIn page. Schuster is an Ameriprise financial advisor in Magnolia, Arkansas.
Pilant, for her part, is now a financial advisor at Dynasty Wealth Solutions in Bartlett, Tennessee, and has been registered with the independent broker-dealer Cambridge Investment Research since 2024.
Pilant accuses Ameriprise of defaming her in its U5 filing
In siding with Pilant, the three arbitrators on the panel awarded her $120,000 in compensatory damages, $80,000 for emotional distress and $500 to cover her filing fee. The arbitrators also granted her request to have Ameriprise's reasons for letting her go in 2024 expunged from her official FINRA records.
"The Panel orders expungement based on the defamatory nature of the information," according to the panel's decision.
Douglas Schulz, the president of Invest Securities Consulting and a securities expert, said it's fairly uncommon for an arbitration to award monetary compensation on top of expungement.
"The panel obviously thought there was something fairly serious that they did put on her U5," he said. "She got money and they ordered them to fix the U5. That's as good as you can ask for."
Expungement in the brokerage industry is meant to be an "extraordinary remedy" for advisors facing accusations that are ""factually impossible, clearly erroneous or false." FINRA made changes to its expungement rules in 2023 in response to complaints that expungement was being granted too readily.
But the number of expungements granted by arbitration panels has only climbed.
FINRA arbitrators rarely explain why they handed down an award, and the panelists in this dispute provided few details. They did note that Pilant had accused Ameriprise of defaming her in the Form U5 but did not report details of what Ameriprise wrote.
Changing the U5 language to "voluntary" departure
In granting Pilant's request for expungement, the panel ordered that her official record be revised to indicate her reasons for leaving were "voluntary" and called for Ameriprise's explanation for her firing to be "deleted in its entirety." Ameriprise was also required to withdraw or expunge a filing made with the Kentucky Department of Insurance that described its reasons for firing Pilant.
Ameriprise and the employees cited in Pilant's complaint responded by invoking Tennessee's Anti-SLAPP Act, which is meant to provide protection from merciless lawsuits over the use of free-speech rights. The defendants argued they were being hauled before a FINRA arbitration panel merely for "filing government-mandated forms disclosing required facts about a registered representative and investment advisor representative," according to the award.
