When your er calls or meets with you to recommend an investment, there are a lot of things you ought to know before you agree to invest. Here are five questions you should always ask. 1. Why is this investment suitable for me? Every investment a broker or financial advisor recommends must be consistent with a …
The Financial Industry Regulatory Authority (FINRA) maintains BrokerCheck, an online database that enables anyone to quickly obtain a summary background report about virtually any stockbroker. This search tool is easy to use and its reports are generated free of charge, yet most people still select brokers without running their names through BrokerCheck. That’s a big …
When Attempting to Persuade Arbitrators, a Dozen Victims are Better Than One. “So okay,” you say. “Group cases sound like they’re better than class actions. But what if I had a really big loss and have the money to afford litigation costs. Wouldn’t I be better off suing on my own than being part of a group?” …
While Class Members Surrender All Control to the Lawyers and Court, Group Arbitrations Keep Clients Involved and In Charge. As we noted in part 1, securities class actions tend to produce paltry returns for victims, while group arbitrations generally result in significant individual recoveries. There are many reasons for the disappointing results in class actions, …
Modest Losses? In Group Arbitrations, a Lot of Little Can Be Really Big We’ve said it before, we are not a fan of class actions. In fact, except for the lawyers who handle them, no one is a fan of class actions. Class actions definitely play at least a small role in deterring bad corporate …
In October 2011, Charles Schwab & Company informed its customers that it had amended its account agreement to prohibit customers from either bringing a class action suit against Schwab or participating as a class member in such an action. The amendments also purported to force the customer to agree that arbitrators would be precluded from …
Interest rates are near all-time lows. Consequently, whenever rates finally start moving again, we all know they’ll be going up. No one knows for sure when rates will begin to rise, but the Financial Industry Regulatory Authority must be worrying that the day isn’t far off. It’s just released an Investor Alert entitled “Duration – What an …
Words like “new and different” or “new and improved” might pique your interest when it comes to computers or cleaning products. But if your broker offers you a newfangled investment product, especially one that seems really complicated, watch out. The overriding purpose of Wall Street’s inventiveness is first, last, and always to generate fees and …
Over the past several years, we’ve handled many customer cases against investment firm Sanders Morris Harris, Inc. arising from sales activities at its Solon/Beachwood branch office in suburban Cleveland, OH. Last month, FINRA announced sanctions against SMH and two of the registered principals at that office, based upon both their failure to properly supervise a broker who …
When you lose a lot of money in an investment account, you may wonder whether your financial advisor was to blame. A definitive answer usually requires a careful review of account records by someone who knows what to look for. But it’s not difficult to figure out whether the circumstances of your loss warrant suspicion …
The Stockmarketloss.com group is investigating potential individual and group claims concerning mortgage-backed securities sold by Bear Stearns and/or EMC Mortgage, including the following: Bear Stearns Alt-A Trust Bear Stearns Asset Backed Securities I Trust Bear Stearns Asset Backed Securities Trust Bear Stearns Mortgage Funding Trust Bear Stearns Second Lien Trust SACO I Trust Structured Asset …
On September 27, 2012, FINRA Chairman and CEO Richard G. Ketchum spoke at the Complex Products Forum sponsored by the Securities Industry and Financial Markets Association (“SIFMA.”) (You can read the speech here). SIFMA is a trade association and lobbying group that represents hundreds of securities firms, banks, and asset managers, so Ketchum was addressing …
The Financial Industry Regulatory Authority (FINRA) announced today that it has censured and fined Merrill Lynch for deficiencies in required disclosure reports and for often failing to file such reports. Merrill was fined $500,000 for its supervisory lapses. The violations, which supposedly went undetected for years, involved non-disclosure or inadequate disclosure of customer complaints, arbitration …
Exchange Traded Notes or “ETNs” are unsecured debt obligations typically issued by financial institutions. They differ from traditional bonds because unlike bonds, ETNs don’t pay any interest to investors. The issuer instead undertakes to pay the holder of the ETN at maturity (which can be 10, 30, or even 40 years after issuance) a “distribution” …
It has always been our position that a stockbroker owes his or her customer both a suitability obligation under FINRA rules and (at least in our home state of Ohio) the broad duties of a fiduciary under state law. Thus, we’ve consistently asserted in securities arbitrations that any investment-related recommendation must be in the customer’s …
