Seru, Matvos and University of Minnesota professor Mark Egan compiled data on 644,277 currently registered advisors and 638,528 advisors who had left the industry for the period 2005 to 2015. They included both stockbrokers who are overseen by the Financial Industry Regulatory Authority, or FINRA, as well as investment advisors who are regulated by the Securities and Exchange Commission.
They eliminated 18 percent of the advisors from the study because they were not able to identify their gender.
To determine who had engaged in misconduct, they drew from a public database run by FINRA, which includes information about customer disputes, employment separation after allegations, and final regulatory, civil and criminal actions.
Overall, 7 percent of advisors have records of misconduct, with 9 percent of male advisors and 3 percent of females having at least one disclosure on their records, the study said.
Men were more likely to have multiple problems on their records, with 41 percent showing two or more adverse disclosures. Only 22 percent of the women in the study had two or more disclosures.
When customers complained about male brokers, it tended to be more costly for their employers. The median amount of a settlement for a male advisor was $40,000, the study said, compared with $31,000 for a female. The average settlement for males was $832,000 compared with $320,000 for females.
The professors said that the source of the discrimination appeared to be the advisors' employers — not customers or regulators bringing actions against them. Misconduct complaints against men came from their employers only 28 percent of the time. That compares to 41 percent of the complaints against women.
At the Wells Fargo unit, women were 27 percent more likely than men to lose their jobs after misconduct, Seru said. That compares with a 9 percent difference at the average firm in the study.
The bottom line at brokerage firms is that managers dealing with an errant male broker seem willing to consider that he's "a good guy who deserves a second chance," Matvos said. "But for females, you don't get a second chance."