Six Connecticut-based Citizens employees resigned in a 49-minute span after their manager signaled his exit, the bank said. An additional talent migration in Texas shows a “pattern of racketeering.”
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Citizens Banksued SoFi last week, accusing the digital lender of poaching 30 mortgage-focused employees since 2024.
The hires have affected business in nine states, Providence, Rhode Island-based Citizens alleged. But the lawsuit, filed Wednesday in the U.S. District Court for the District of Connecticut, focuses on two groups of employees.
Citizens asserts that SoFi “strategically orchestrated” the resignations of nine Connecticut-based Citizens employees in June, “effectively annihilating” the branch where they worked.
When Michael Daversa, a mortgage market manager, resigned from Citizens on June 12, he told the bank “he had no idea” whether any other employees were leaving with him, Citizens said in the lawsuit. However, six colleagues on Daversa’s team resigned within 49 minutes, and two more resigned later that day, the bank said.
Further, Citizens argues that it found, during a review, that Daversa has contacted multiple Citizens employees, touting SoFi’s ability to “get ahead of the pack.” The bank also said Daversa confirmed that at SoFi he would “work with familiar faces.”
Days before his resignation, Daversa sent screen shots of Citizens client lists to his personal email account, the bank argued. One colleague attempted to upload a spreadsheet of confidential client data, contacts and real estate agent referrals, Citizens said. A loan pipeline report was printed on the day of the resignations, the bank said.
In all, the Connecticut employees who left Citizens for SoFi in June accounted for more than $400 million in closed loans that generated roughly $5 million in revenue in the previous year, Citizens said. That represents 70% of the branch’s mortgage producers and 80% of mortgages, the bank said.
The June departures, Citizens contended, “essentially eliminated” the bank’s market presence in Connecticut. Citizens has lost three additional Connecticut-based employees to SoFi since the initial migration, the bank said.
“Rather than build a business unit on its own or engaging in an arm’s-length transaction to acquire a valuable business unit that Citizens had built, SoFi has stolen the fruits of Citizens’ efforts,” Citizens wrote in its lawsuit.
A spokesperson for San Francisco-based SoFi, however, called the lawsuit “a baseless allegation and a clever attempt to prevent Citizens employees from pursuing career opportunities elsewhere.”
“We lawfully compete to recruit and retain the best talent and expect other organizations to do the same,” the spokesperson said in a statement seen by Banking Dive.
Citizens is accusing SoFi of obtaining and using trade secrets without authorization, interfering with Citizens’ employment contracts and customer relationships, and helping former employees violate their noncompete clauses. Perhaps most strikingly, Citizens called SoFi’s alleged theft of trade secrets part of a “pattern of racketeering activity.”
Throughout the lawsuit, Citizens has several colorful descriptions of the bank’s view of SoFi’s actions, such as: “choreographed misconduct”; “reckless indifference”; and “unscrupulous and oppressive.”
Citizens also called it a “well-established modus operandi” and cited another mass migration of talent to SoFi. In August 2024, a Texas-based, then-head of consumer lending left Citizens for SoFi, which would go on to hire 11 more employees from Citizens’ Texas mortgage department, “effectively handicapping Citizens’ ability to operate its mortgage department in the southwest region.”
SoFi has argued Citizens has produced no evidence that the company provided any incentive for ex-Citizens employees to violate their contracts.
Citizens, for its part, asserted it has sent cease-and-desist letters to the Connecticut employees who left. But the bank said it did not receive a response from its former workers or from SoFi.
SoFi has until Sept. 30 to respond to the lawsuit.
