Securities & Stock Broker Fraud Blog
Morgan 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.
According 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.