Broker-dealers may face higher costs connected with customer disputes if revised legislation that would do away with mandatory securities arbitration passes both houses of Congress and is signed into law.
Keeping track of rogue brokers is a tricky business, particularly when they leave or are booted from the confines of the securities industry, but keep peddling financial products.
If legal action against Fisher Investments is any indication, financial advisers increasingly will face lawsuits and arbitration claims from clients who are angry about investment losses.
On the back of strong recruiting and the ability to attract new clients, LPL Investment Holdings Inc. of Boston has reported net income of $14.8 million for the first three months of this year — an increase of 26.8% over the same period in 2008.
Fisher Investments, one of the country’s most noted investment advisory firms, has been tagged with a $1.2 million arbitration claim, alleging that it failed to live up to its fiduciary duty during the recent calamitous market meltdown.
A day before he and his hedge-fund consulting firm were stung by the Securities and Exchange Commission with $815,000 in fines and penalties, a major figure in the hedge fund world started his own effort to change hedge fund audits.
Running a successful family financial advisory business is much tougher than the smiling portraits posted on many firms' websites would lead a client or prospect to believe.
The stock market's downturn is reshaping the retail-brokerage industry, with disgruntled clients replacing wirehouse brokers with independent representatives and financial advisers.
Considering the economy, the state of the stock market and the public's perception of Wall Street, the immediate outlook for the independent-brokerage business — like most financial services businesses — is anything but glowing.
