A Dirty Secret: Bullying in the financial industry

Are you against bullying? Would you stand against the sort of bullying that has claimed the life of Rehtaeh Parsons age 17. If you answer by the positive, then I would call you a hypocrite. I would dare call you a liar. I would also comment on your lack of honesty and courage. I would do this because we in the financial industry have accepted bullying as a way of doing business. We in the financial industry have been unwilling to clean our own backyard from this scourge. We in the financial industry are a poor example to the kids that are victims of bullying or for those kids that are fighting to end bullying. We in the financial industry know better but choose to ignore the worst.

Are you wandering what I am talking about? Well I am talking about a business practice that most of us have witnessed. We know this business practice is wrong but we look the other way. It is time that independent advisors send the message that they will be idle no more by denouncing this bullying practice. I am talking about the practice of destroying the life of advisors that are captive and who have decided to become independent. As soon as these advisors decide to become independent, they are attacked. Lies are told about them. False accusations are made. Harassment is continual. They are robbed of their reputation and of their right to make a living. It is wrong and it has to cease.

Yes I am mad. I am in a rage after reading a Court account of a civil lawsuit Kosko c. Bijmine 500-17-015325-031 where we see the professional life of Mr. Kosko entirely destroyed just because he wanted to be an independent advisor. In the Court decision we learn that Mr. Kosko started to work as a captive agent for Desjardins Insurance in 1988. His director is a man named Gilles Verreault. In 1990, he becomes assistant director of the Brossard branch in Quebec. In 1993, he becomes responsible for the recruitment and training of advisors. He then decides to go on his own and to become independent by creating his own firm Services Financiers Jacob Inc. During four month his business is going well and then his life turned into a nightmare.

Kosko learns from one client that Gilles Verreault his old director had been telling lies about him stating that the insurance policy he had sold to her son was not valid; that Kosko was a thief and fraudster; that he is building a file and case against Kosko to ensure his license is cancelled. These threats, lies and attacks take a toll on Kosko and his business starts to suffer. He quits losing the will to continue. When you get bullied you lose your self esteem and its starts affecting the people around you such as your family and his relation with his wife and children starts to suffer.

First let’s be clear on Gilles Verreault. The Superior Court of Quebec when referring to the statements made by Gilles Verreault qualified his accusations as untruthful and injurious. These accusations were not true so what happened to Kosko was not because of guilt because he had done something wrong. This was because he was the victim of bullying.

But the bullying did not stop there. To protect Gilles Verreault, Desjardins took over the bullying. In 1994, Kosko is looking for employment and applies for a position at SFL for a director position. The interview goes well until SFL requests an employment report from Equifax. In this report, Desjardins destroys the reputation of Kosko to such an extent that he is unemployable. Kosko requests that Equifax withdraw these lies but Equifax know who pays the bill and refuses to listen to any of the objections of Kosko.

Again and again he tries to get a job but this Equifax report always resurfaces and he never get a chance to get a job until 1995 when he becomes employed at Prudential to start a branch. He tries to legally revolve his problems and he then enters a new world of bullying which is the legal bullying where the strong and the rich are mighty before the judges and where the weak must cower.

First kosko’s lawyer is negligent as per the conclusions of the Court. Also the Court finds that the loss of confidence by Kosko is due to his lack of skill as an insurance agent. Starting in the insurance business from scratch (with 0 clients) is the hardest thing to do in life. Each rejection is a blow to your bottom line and to your confidence. I know this because I have done it. It is pure survival. When you add to this mixture someone who is trying to destroy you by ruining your career and trying to have your license revoked, it is just enough to give you the wrong nudge on the wrong side of confidence. So I don’t agree with the judge. Kosko never had a chance.

In the end Desjardins and Equifax paid $40,000 to Kosko for damages.

The story of Kosko is not unique in the financial industry. I have personally witnessed such stories and I know you have also. Is it time that this ends? Is it time for independent advisors to stand for what they believe? By our example, the financial industry is sending the message to the kids that bullying can never be ended and that the best they can achieve is to delay it by removing from school but after this it is an acceptable business and employment practice. If we let this happen, then yes we are cowards; yes we are hypocritical and we are examples not to follow.

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6 comments

  1. I am very curious to know why you did or said nothing in those instances that you witnessed similar bullying activities in your career.

    I teach my 14 year old son to stand up to bullies even those bullying others and gave him the skills to do so. As a professional, our adherence to professional ethics should be sufficient to call out others who are violating the law. All of this anonymous ranting could perhaps become a more effective avenue for change if you had spoken up when you witnessed other advisors being harassed.

    A large Canadian Bank tried to bully one of our advisors (we are an independent advisory firm) and our response was to support the advisor and use every tool necessary to get it to stop including a threat of legal action and what do you know . . . just like schoolyard bullying, the bully backed down and the slander stopped.

    All evil needs to thrive is for good people to do nothing.

    I support your call out to fight against corporate bullying in the financial services and also support coming out from the shadows to do it in the open. Shinning a bright light has a way of reducing the activities that take place in the dark.

    • Jules, it is always exciting to receive amazing and well thought of comments on a blog. Your question goes right to the center of the target and I will try not to disappoint you with my response.

      How many excuses I could give you. I could tell you that my employers always told me to back down and not to do anything or say anything. (And an employer has the right to silence you since what you say will be considered also the position of the employer). I could tell you it’s always been like this. I could tell you I did not know any better. I could have told you that it would have not changed anything except destroying my career. But while these excuses are all true, they are still just excuses. In the end, I have to accept my part of responsibility for this problem in the financial world I worked in.

      However along the way, I learned better and learned to fight for the principles I believe in. But let’s not kid ourselves. To speak out has consequences. You can only do this if you are independent and this means once you speak out you become unemployable like me as an employee. You have to be careful also. If you speak out as an individual alone, you are an easy target and those who you accused, who often have deep pocket, will destroy you financially and don’t expect any justice. Judges (and this is based on my experience) will close their eyes on this situation. In fact the legal system is a bullying system based on money. Whose has the deepest pockets wins…

      Yes I have learned better and now when I see injustice I speak out. But I can tell you it takes courage. Since then I have been the subject of two attempts of blackmail. There have been threats. The Quebec government (AMF) has even tried to impose the seal of secrecy on my 25 years career stating that under the law I could not talk, discuss or write about my career. I refused this and we could say now I am a criminal since I am breaking the law. They have thrown Revenue Quebec at me, trying to make me pay income tax in Quebec when I am a resident of Nova Scotia. You have to understand. It’s one thing to stand up to one case of bullying and it’s another one to try to change the system. The system fights back and it plays dirty. For example a lawyer in Quebec has confirmed to me that the AMF had created a directive whereby anyone talking to me will be the subject of reprisals.

    • Jules, a side comment. Soon I will take to task the president of the AMF on his latest statement this his organization will be fair in its sanctions. I intend to take him up on his words by asking what he is going to do about a case of an advisor who was suspended and is still suspended because she is simply the spouse of an advisor accused of infractions that were not true (confirmed by the AMF). We fought for women equality the same way we are fighting against bullying. Considering a woman a simple extension of her husband is not acceptable. She is a distinct person with all the rights that comes with this. I will be asking the AMF to reinstate immediately the license of this woman allowing her to earn her living. I hope I will have the support of the industry and people like you.

  2. You do have my support in these matters and I believe it is very important to shed light on these issues.

    I am sorry that past efforts have gotten you in hot water with some powerful people and I did not intend to insult you by challenging your anonymity on this forum. I respect anyone who calls out and who fights for what is right.

    Keep it up!

    • Jules I want to reassure you that you did not insult me. Your question was valid and very important. Also you did not challenge my anonymity as i sign and my name stand by everything I write. My past efforts have not gotten me in hot waters just in the right waters. However I do have to acknowledge that I underestimated the length the opposition was willing to go to protect the status quo and overestimated the sense of ethics of many people. So my keep it up also and stand by what you believe but be careful…

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