RBC will pay nearly $9.7 million after FINRA arbitrators ruled in favor of a Minnesota-based advisor who claimed the firm discriminated against her based on age and gender.

Cinda Collins joined RBC Capital Markets in 1992, eventually becoming a senior vice president and financial advisor. However, she left the firm in 2019 and joined Wells Fargo Advisors several weeks later, where she remains a managing director, according to LinkedIn. 

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According to the award document released earlier this week, she filed a statement of claim with FINRA in August 2020, seeking arbitration against RBC. 

In her initial claim, Collins accused RBC of discriminating against her in violation of federal law and that “by terminating (Collins) because she was nearing retirement, (RBC) could steal much of her book of business without compensating her for it.”

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As part of the arbitration, Collins asked the panel to order RBC to file a new Form U5 indicating she was fired “without cause,” award her compensatory and punitive damages and recoup the costs for bringing the action to arbitration. According to the award document, RBC asked for the claims to be dismissed.

In an interview with WealthManagement.com, Joseph Anthony, an attorney and executive committee member with the law firm Anthony Ostlund (who also served as one of Collins’ attorneys), said Collins had initially been a pediatric nurse before joining the industry and had built a book of business with a partner between $400 million and $500 million by 2016 (the partner left for UBS around then, according to Anthony).

Collins brought on a new partner, intending to hand off her book when she planned to retire in a few years. However, she soon grew worried her clients would not click with her new partner and reconsidered her retirement plans. The duo also brought on a client associate who Anthony claimed did not have experience in the field. 

After the individual went on maternity leave and returned, Cinda’s partner privately complained that Collins discriminated against the associate for taking the leave. According to Anthony, the firm conducted an investigation, but the true motivation was to snatch Collin’s book of business after she reconsidered her initial plan to retire.

“They decide to fire her, and there’s some evidence that they made that decision before they even interviewed her,” he said. “They made an educated guess and took a gamble that they could get away with it.”

Arbitrators agreed with Collins’ claims of age and sex discrimination. They demanded RBC pay about $6 million in compensatory damages, an additional $2 million in punitive damages and approximately $1.41 million in attorneys’ fees (in addition to several other costs). The total for RBC came out to $9,650,367.56. However, arbitrators didn’t require RBC to submit a new Form U5. 

RBC was “disappointed in and disagree with the panel’s decision,” according to a firm spokesperson.

“At RBC, we value diversity and inclusion, we do not tolerate unlawful discrimination, and we maintain a workplace culture where all employees are respected and treated fairly,” they said.

The firm could appeal the decision, at which point it would enter the legal system in district court. However, Anthony noted that several RBC executives (including RBC U.S. Wealth Management CEO Michael Armstrong) testified during the proceedings, which was not always positive for the firm.

“So there’s a high risk in appealing this because everything those three executives testified to would be put then in the public forum and available to anybody to read,” he said. “And it would not be very flattering.”