Typically, stockbrokers earn commissions each time an investor enters a securities order to buy stock or sell stock. Full-service stockbrokers earn higher commissions than online stockbrokers because, unlike online stockbrokers, full-service stockbrokers provide investors with the added service of advising you when to buy, sell or hold particular investments. Because stockbrokers are paid on commission, there is an inherent conflict…
Deutsche Bank is in the news again, this time for false and misleading sales practices. At the heart of a complaint filed by the Securities and Exchange Commission (SEC) was a quid pro quo relationship in which Deutsche Bank offered only those funds whose sponsors agreed to kick-back a portion of their management fees to Deutsche Bank. The problem with…
In recent years, employees have been filing an increasing number of meritorious lawsuits against employers for 401(k) mismanagement. These claims are in the tens of millions of dollars and range from disloyalty to imprudence to disregarding conflicts of interest. Some of the more egregious claims come when employers populate 401(k) plans with their own expensive and poorly performing proprietary investment…
In the realm of financial services, unknowing investors often fall victim to various securities fraud schemes, and one of the more common ones is the “pump and dump.” “Pump and dump” schemes are often associated with penny stock fraud and microcap fraud and are serious violations of the law. The “pump and dump” is a real-life example of the saying…
The average person seeking financial advice for their retirement is unaware that the persons giving them advice are under no obligation to be loyal to their needs, to make prudent investment recommendations for them, or overall to act in their best interest. As a result, over the years many financial advisers motivated by their own self-interest have taken advantage of…
is currently investigating the way E* Trade recently handled the assignment of a naked in-the-money put on the S&P 500 ETF (symbol SPY). A volatile price drop in SPY on the Friday of expiration triggered a likely assignment of 5,000 SPY shares. Rather than closing out the put contract before the close of options trading on Friday, or waiting until…
In an effort to enhance investor protections, the Securities and Exchange Commission (SEC) is proposing a new rule – Regulation Best Interest – that may come as a surprise to some investors. The SEC’s proposed rule requires your stockbroker to act in your best interest at the time he or she recommends an investment to you, something that the average…
Did you know that, except in a few unusual circumstances, lenders and bank loan officers do NOT owe you a duty to act in your best interest? Did you know that it is legal for them to offer you, and even recommend, a loan that you are not equipped to payback? Oftentimes, when people decide to take out a loan,…
Suit alleges that Home Depot Places Employees in Poorly Performing Funds and Causes Employees to Overpay for Robo Investment Advice ATLANTA, April 12, 2018 /PRNewswire/ — and Blumenthal Nordrehaug Bhowmik De Blouw LLP filed a class complaint today in the U.S. District Court of the Northern District of Georgia, alleging that Home Depot violates basic fiduciary duties under ERISA and…
We want to share with you a disturbing tale we heard recently from an investor in a private investment fund. We share this to alert you to “red flags” that signal the high likelihood of investor fraud. If you can spot them, you can better protect yourself from financial predators. The enactment of the Dodd-Frank Act ushered in a new…