Though investors who have already been “burned” by stock broker fraud or broker misconduct may have a perfectly understandable fear of getting back into the securities game, there are ways investors can help protect themselves in the future. One of the most significant protective measures an investor can take is to look into the background…
Continue reading ›A new investor alert from the Financial Industry Regulatory Authority cautioned investors about scams related to investment in gold stocks. The alert, titled, “’Gold’ Stocks—Some Investments Mine Your Pocketbook,” provides information on legitimate gold investments and how to invest in them as well as dangers of illegitimate gold investments. The record price of gold bullion…
Continue reading ›Securities arbitration for Frankfort, Ill., trader Robert T. Bunda ended with a sixteen-month suspension and a total penalty of $346,740. The payment order includes $171,740 in restitution and a $175,000 fine. The restitution total is equal to his total personal gain that resulted from his misconduct. The Financial Industry Regulatory Authority (FINRA) found that Bunda…
Continue reading ›Financial advisers are bound by their fiduciary duty. Put simply, fiduciary duty is when one party (in this case, the financial adviser) must, by law, act in the best interest of another party (in this case, the client). Financial advisors have a legal obligation to act in the best interest of their client as they…
Continue reading ›Court proceedings concluded this month for 15 investors who fell victim to stockbroker fraud in which Lawrence E. Chia, a former Michigan stockbroker, stole around $2 million by “investing” their money in “Crystal Sky” and then mailing falsified subscription statements. “Crystal Sky” was the name Chia gave to his fake bond fund and all mailed…
Continue reading ›The Financial Industry Regulatory Authority (FINRA)’s new Rule 2111 will help prevent broker misconduct resulting from a failure to adhere to the suitability standard by adding several factors to determining suitable recommendations. Previously, the only factors brokers were required to consider when offering investments to customers were investment objectives, tax status and financial status. Under…
Continue reading ›The SEC’s new whistleblower office, which officially opened August 12, hopes to have a significant effect on corporate and stock broker fraud. Under this new program, cash awards will be issued to corporate employees who report fraud to the SEC in order to expose corporate crime. Individuals who report fraud under this program could receive…
Continue reading ›As is required by the Dodd-Frank Act, the SEC has adjusted rule 205-3’s performance fee eligibility thresholds for inflation. These adjustments were announced by the SEC on July 12. The order will be published in the Federal Register and will go into effect 60 days post-publication, or September 19, 2011. The revised dollar amounts take…
Continue reading ›The Financial Industry Regulatory Authority (FINRA) announced on August 9, 2011, its decision to fine Citigroup Global Markets Inc. for failing to supervise one of its former registered sales assistants, Tamara Moon. Moon was employed at Citigroup’s Palo Alto, California, office and misappropriated a total of $749,978 over 8 years. In addition, she engaged in…
Continue reading ›Securities arbitration ended with a Financial Industry Regulatory Authority (FINRA) announcement on July 26 that SunTrust Robinson Humphrey Inc. and SunTrust Investment Services Inc. will pay a total of $5 million for “violations related to the sale of auction rate securities (ARS).” $400,000 of the $5 million fine will be paid by SunTrust IS for…
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