LPL Financial Sues Ameriprise for Defamation, Seeks Restraining Order
By Staff
LPL Financial, the nation’s largest independent broker-dealer, has filed a new lawsuit against Ameriprise Financial, alleging defamation and tortious interference following a controversial set of “data breach” notices sent to clients who had transitioned from Ameriprise to LPL.
LPL also requested a temporary restraining order, or TRO, in an attempt to prevent Ameriprise from making further statements that the firm deems defamatory.
According to LPL, their complaint, filed in the U.S. District Court for the Southern District of California, stems from notices Ameriprise recently sent to clients whose advisers had moved to LPL between 2018 and 2020. The notices warned clients that their former Ameriprise advisers had “shared certain confidential personal information about you and your account(s) that exceeded the limited scope of information your former adviser was permitted to use for transition purposes.”
LPL argues that the notice is defamatory because it falsely implies that its clients face a risk of identity theft caused by their own financial advisers. The firm has stated that it will seek damages in the ongoing arbitration between the two industry leaders.
“These notices misrepresent routine account transitions and falsely claim the advisers mishandled client personal information,” a spokesperson for LPL stated. “This is a blatant and desperate attempt to instill fear and distrust in these investors and tarnish the reputation of their advisers.”
A spokesperson for Ameriprise countered, “Once again, LPL is trying to shift the narrative away from its misconduct instead of focusing on what matters most – protecting clients and their sensitive data.”
The ongoing legal feud between LPL and Ameriprise has recently been overshadowed by the news that LPL is acquiring Commonwealth Financial Network for roughly $2.7 billion in cash, and that approximately 2,900 financial advisers from the Commonwealth network are expected to be added to LPL’s platform, barring recruitment from other wealth managers.
Nonetheless, LPL’s lawsuit is the latest activity between the two firms. According to third-party reporting, LPL has stated that 30 financial advisers joined LPL from Ameriprise between 2018 and 2021. Following these departures, Ameriprise reportedly took the position that advisers could not retain client information when transitioning to a new firm. LPL, however, has contended that Ameriprise’s own franchise agreements allow departing advisers to retain specific client data necessary to continue serving those clients after the transition.
Ameriprise then responded with its own court complaint in July 2024. LPL further noted in its complaint that in December 2024, Ameriprise initiated FINRA arbitration against all 30 advisers, demanding they surrender their personal devices and cloud storage accounts for forensic analysis to determine whether any Ameriprise trade secrets had been improperly retained.
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