Federal officials have warned that a grand jury decision related to the police shooting of Michael Brown could lead to violence in the areas near Ferguson, Mo. As a result, financial services firms in the area, including Benjamin F. Edwards, Wells Fargo Advisors and Edward Jones, are preparing contingency plans in case rioting breaks out.
Missouri Gov. Jay Nixon on Monday issued a state of emergency and activated the National Guard ahead of grand jury decisions on two separate criminal investigations into the fatal shooting of unarmed black teenager Michael Brown by a Ferguson, Mo. police officer this summer. The St. Louis County prosecutor has said the decision will be made later this month, but a definitive timeline has not been released.
An FBI intelligence bulletin obtained by ABC News said, “The announcement of the grand jury’s decision … will likely be exploited by some individuals to justify threats and attacks against law enforcement and critical infrastructure.”
The suburb of Ferguson, where protestors violently clashed with police in the days following the August shooting, is only about 12 miles from downtown St. Louis and major brokerage firms like Wells Fargo Advisors, Edward Jones and Benjamin F. Edwards are headquartered throughout the city and surrounding suburbs.
“You prepare for the worst, but hope for the best,” said Chris Keller, senior vice president and chief information officer at St. Louis-based Benjamin F. Edwards & Co. The firm is already briefing its 100 home-office employees and about 10 financial advisors in the area on the situation and is prepared to immediately go ahead with its phased contingency plan if needed.
In the event of an emergency, the firm has a designated site in O'Fallon, Ill., about 25 miles outside of St. Louis. Normally, the site operates as a branch office with about 20 percent of its workforce there on any given day, Keller said. The firm has total remote capabilities.
“It’s about safety,” Keller said. “You don’t know what will happen—it’s an unprecedented situation in our community.”
But because the timeline and potential outcome of the decision are so unpredictable, the firm is preparing their financial advisors for business as usual. “You can’t really script this, you almost have to over-communicate.”
"We've told our folks to limit the number of in-person meetings you have until this plays out," said Dan Haynes, director of compliance at Buckingham Asset Management. “We’re asking people to be a little more thoughtful,” he said, adding he’s recommending advisors leverage phone and GoToMeetings as touch points.
Buckingham, which is headquartered just blocks from the county courthouse and police station, has about 40 advisors in the St. Louis area. “While the outcome of the verdict is unknown, the potential for localized protests (peaceful or otherwise) is likely and should we need to close our St. Louis office temporarily, our associates have the same full access and capabilities at their home offices as they do in their work locations and will be fully accessible,” said firm spokeswoman Meredith Boggess.
If the decision comes down after hours, Haynes says Buckingham also has an emergency phone alert system they can use to call associates with pre-recorded messages outlining the firm's plan of action. “Given what we saw over the summer, it would be imprudent to take this lightly,” Haynes said.
At Edward Jones, which has two campuses about 15 to 20 minutes away from Ferguson by car, management has taken precautions to assure the firm operates safely, spokesman John Boul said Tuesday. “Our highest priority is the safety of the clients who visit our branches and our associates,” noting there are around 5,000 associates based in St. Louis and about 400 branch offices.
Scottrade spokesman Whitney Ellis said the firm has plans in place for a variety of circumstances that could affect its associates and clients.
Wells Fargo Advisors spokeswoman Rachelle Rowe said the firm is monitoring the situation and will take the steps needed.
RIAs in the area such as Moneta Group Investment Advisors are also taking steps to prepare. “For now we are likely planning to work from home the day after the announcement is made in order to ensure our clients and employees’ safety,” said Spokeswoman Emily Barlean, adding that after that, it will be a “play it by ear” type of situation depending on if things get bad.
A representative for Stifel did not immediately respond to requests for comment.
Months after Hurricane Sandy shut down a significant number of East Coast financial services firms for days after the storm, the U.S Securities Exchange Commission issued a risk alert in August 2013 that said advisors’ fiduciary duty requires them to have a business continuity and disaster recovery plan in place. FINRA also requires brokerage firms to have continuity plans in place in form of rule 4370.
