Articles Tagged with unsuitability

cropped-High-Res-TA-2018-2019-284x300Morgan Stanley terminated around ten brokers following a nationwide probe of alleged abuses in its inherited account program, according to lawyers, firm sources and former managers per advisor Hub.  Miller Stern Lawyers – 410-Law-Firm is currently investigating clients of Morgan Stanley who are victims of, and suffered damages and losses, due to these abuses.

The investigation was prompted by complaints about underpayments from at least one retired broker who entered the Former Advisor Program (FAP), a so-called sunsetting plan that Morgan Stanley and other large firms have promoted heavily in an attempt to keep older brokers from joining other firms and taking clients with them.

according the the article, the programs allow older brokers to receive a split of fees and commissions paid by former clients for several years if the brokers let their practices lapse after they leave.

Bull BearMiller Stern Lawyers – 410-Law-Firm is currently investigating clients of former Merrill Lynch broker Andrew LeBlanc, II for selling away. among other things and suffered damages and losses to their financial holdings.

According to Advisor Hub, former Merrill Lynch broker in New York has agreed to a six-month suspension and $20,000 fine for allegedly helping three customers make outside investments without firm approval, according to a settlement issued by the Financial Industry Regulatory Authority.

Bull BearAccording to Advisor Hub customer complaints and litigation against brokerages will be heating up with the market turmoil.  Most of the industry will likely conclude that coronavirus pandemic fears and oil wars between Russia and Saudi Arabia are the cause of the market drop and are totally out of anyone one person or companies control, however there can be broker misconduct involved in the level of losses because of things such as over-concentration and other individual account irregularities.

“The extent of losses may not be apparent to investors for three to six months, they said, and plaintiffs’ lawyers will then have to analyze portfolios and underlying claims of unsuitability to triage the ones most appropriate for litigation.”

The S&P 500, Dow Jones Industrial Average and Nasdaq Composite are in bear market territory down 20% from their February highs.

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