Securities

When Your Broker Departs

When Your Broker Departs

The financial industry self-regulator, FINRA, issued a new regulatory notice today aimed at broker-dealers with departing brokers. The notice was intended to urge broker-dealers to be more clear and forthright with customers about departing brokers and what will happen to the customers’ accounts. If you’ve ever been in the situation where your broker has either left for another firm, left the industry, or passed away, you understand just how confusing things can get when it comes to who will be handling your investments and why.

'Trust But Verify' When It Comes to Friendly Advisor Recommendations

'Trust But Verify' When It Comes to Friendly Advisor Recommendations

In many cases, the operators of financial frauds and Ponzi Schemes the world over rely on people who have already been duped to bring in new suckers. Of course, the ones touting the services of a particular fraudster have no idea they’ve not only been deceived, but that they are helping weave an even larger web of deception. While it’s appealing to let others pick your advisor for you, the best thing to do is ‘trust but verify’ all financial opportunities.

Warren Wants FINRA to Toughen Broker Expungement Rules

Warren Wants FINRA to Toughen Broker Expungement Rules

Sen. Elizabeth Warren, a Democrat from Massachusetts who recently announced she would be running for president, urged the CEO of the securities industry self-regulator, FINRA, to toughen new rules controlling the expungement of incidents on the permanent records of financial professionals.

New Rule May Have Big Impact on Older Investor Claimants

New Rule May Have Big Impact on Older Investor Claimants

According to a recent announcement from FINRA’s Office of Dispute Resolution, they are drafting a new rule which would tag cases involving claimants 75 years or older for expediting processing. FINRA already has expedited processing available for 65 year or older or sick claimants — but the deadlines that generally determine the timing of the arbitration do not change. FINRA’s new rule would tackle that problem and hopefully greatly improve how quickly expedited claims move through the process by changing — ie, shortening — the actual deadlines.

Regulator Rules and Tools for Every Retail Investor

Regulator Rules and Tools for Every Retail Investor

FINRA is far from a shadowy regulatory agency. They do their best to find themselves in the public eye, if only to keep investors informed on current regulations and scams. They also keep an exhaustive database of the professional records of all registered broker-dealers and financial advisors; the database is online and searchable. FINRA’s BrokerCheck is a mighty tool for investors seeking to learn more about their advisors; it’s one of many tools and rules that investors can use to protect themselves against fraud and malfeasance.

Is Your Broker to Blame for Excessive Losses in the Stock Market?

Is Your Broker to Blame for Excessive Losses in the Stock Market?

The last few months have been a difficult time for many investors. The stock market has taken a major dive, closing out 2018 with the worst performing December since The Great Depression. With so much volatility, it’s crucial that investors have a carefully planned portfolio with an adequate amount of diversification. Above all, that portfolio should match the individual investors risk tolerance and investment objectives. That match must be valid from the day it was made until today. A portfolio that worked for an individual investor in a bull market may be a terrible match for that same person in a bear market.

FINRA May Ban Non-Attorney Representatives in Securities Arbitration

FINRA May Ban Non-Attorney Representatives in Securities Arbitration

FINRA sent an official request to its governing body, the SEC, asking for a ban of non-attorney representatives, though the request does allow non-attorneys to represent investors pro bono, as well as for investors to represent themselves. FINRA is still awaiting the SEC’s final decision.

Ten Years After the Madoff Scandal: What We Can Take Away

Ten Years After the Madoff Scandal: What We Can Take Away

We may never forget Madoff’s crimes. Let’s hope we don’t. And yet, investors still fall prey to so-called “mini-Madoffs” every day all over the country. If you keep your eye on the financial press, particularly news from regulators such as the SEC or FINFRA, Ponzi schemes identical in nature and structure — if not scope — to Madoff’s bubble up and burst too often to keep track.

How to Sniff Out a Crooked Investment Scheme

How to Sniff Out a Crooked Investment Scheme

An investor gets introduced by mutual friends to a financial professional who almost immediately begins pitching the investor on an amazing opportunity. Because the investment professional seems like a good guy or gal, and because he or she was introduced by someone the investor already knows and trusts, the investor unconsciously transfers that sense of trust to the broker or hedge fund manager or mutual fund whiz. The investor’s guard is already down. What happens next?

How to Tell If A Potential Broker Is Good or Bad

How to Tell If A Potential Broker Is Good or Bad

One big reason brokerage firms severing ties with a particular broker is that investors tend to be loyal to brokers over brokerage firms. In defaming departing brokers, brokerage firms may be trying to pry departing customers away from their financial advisors in order to keep them for themselves.

Financial Scams Targeting the Elderly: A Growing Problem

Financial Scams Targeting the Elderly: A Growing Problem

As baby boomers hit retirements, bringing with them the largest amount of wealth a single generation has ever possessed, regulators at the Financial Industry Regulatory Authority (FINRA) and the Securities and Exchange Commission (SEC) foresee an ever growing number of financial scams designed to separate boomers from their hard-earned savings.

3 "Golden Rules" for Better Financial Self-Defense

3 "Golden Rules" for Better Financial Self-Defense

In the many dozens of securities litigation cases we have worked on for investors, we have noticed that, when it comes to protecting yourself against broker misconduct and financial fraud, there several "golden rules" which, if regularly observed, would prevent the vast majority of abuses in the securities industry. 

Broker Best Interest Regulations Fall Short

Broker Best Interest Regulations Fall Short

In order to reform the system, investor advocacy groups have suggested the SEC enhance the standard to which brokerages and brokers are held with regard to investor best interests. Currently the standard is based on the necessity of matching investor and investment through a concept known as "suitability." Investor advocates like PIABA, however, want to raise the bar to the "best interest” standard.

Ex-Eagles Player Embroiled in $10 Million Ponzi Scheme

Ex-Eagles Player Embroiled in $10 Million Ponzi Scheme

A judge in Virginia federal court ordered a former broker and his alleged accomplice, former Philadelphia Eagles linebacker Merrill Robertson Jr., to forfeit $8 million. The money was allegedly generated by Robertson and Sherman Vaughn Jr. through the operation of a Ponzi scheme which lasted from 2009 to 2016.

Philly District Attorney Launches Unit to Go After Elder Financial Abusers

Philly District Attorney Launches Unit to Go After Elder Financial Abusers

Philadelphia is getting serious about its elder financial abuse problem. As we noted in a recent blog post, the Philadelphia Office of the Securities and Exchange Commission announced that it would be hosting public awareness talks and meetings to combat the growing problem of elder financial abuse. That announcement was followed by the District Attorney for Philadelphia Larry Krasner's statement that he would be creating a special task unit targeting perpetrators of financial fraud against senior citizens.

Is the Broker "Best-Interest" Rule in Your Best Interest?

Is the Broker "Best-Interest" Rule in Your Best Interest?

Investment advisors and financial advisors are held to different standards of accountability when it comes to the investments they make on behalf of clients. Investment advisors have long been held to what is called the "fiduciary standard." Find out what the difference means for you and your money.

The Broker Oath - But Will It Work?

The Broker Oath - But Will It Work?

Thanks to a recent decision by the Fifth Circuit, it appears that brokers will, once again, get off the hook when it comes putting their clients' interests in front of their own. Into the breach has stepped an idea that has been kicking around for a years now, but which may be the best of several uninspiring options to compel brokers to act more responsibly toward investors: The Oath.

How Regulators - And YOU - Can Identify a "High-Risk" Broker

How Regulators - And YOU - Can Identify a "High-Risk" Broker

According to FINRA, while there is no airtight definition of a high-risk (yet), the regulatory body deploys a set of criteria to help identify these individuals and ratchet up the oversight on them. However you can use these criteria yourself to evaluate your own or a potential FA for excessively risky behavior.

Unpaid Awards Plague FINRA Arbitration Forum

Unpaid Awards Plague FINRA Arbitration Forum

Recently, FINRA created a task force to study the problem and discovered that, in the five years from 2012 through 2016, a total of 268 awards (27% of the cases where investors were successful) or $199 million in awards (29% of total damages awarded to investors) have gone unpaid, the report states.