When a financial adviser sells their practice, the transition hinges on whether clients will follow. While client relationships are very personal, client data belongs to the adviser’s old firm, rather than the adviser themselves -- and transferring that data is subject to strict regulatory and contractual constraints. Specifically, federal and state privacy laws often require a client's consent to move their data. However, employment agreements often include restrictions that prohibit advisers from requesting that consent before their departure. How should an adviser proceed? What key questions should advisers ask to understand their risk exposure?
Join RIA lawyer Isaac Mamaysky to learn the key considerations that advisers must navigate when taking clients to a new firm. Participants will learn:
- The legal framework that governs client data transfers, including Regulation S-P and state laws;
- Why the Broker Protocol does not override privacy laws, and what limited protections it actually provides;
- Practical steps for conducting a "liftout analysis," including how to assess firm privacy policies, state-specific opt-in requirements, and pre-departure client communication strategies; and
- How to reduce legal risk during a firm transition, especially when client consent is necessary but hard to obtain without violating contract terms.
