Protection begins with information. Find out as much as you can about the very impressive stockbroker or investment adviser who says he can help you reach your financial goals.
The FBI reports that Americans lose $40 billion every year to investment fraud. But that figure will not motivate anyone to act. It is a sterile number that does not communicate the humiliation, misplaced guilt, and real world consequences to the victims of investment fraud.
If Goldman Sachs were a character in a movie, it would be Eric (“Otter”) Stratton from Animal House.
First, your friendly neighborhood stockbroker, the one who everyone trusts because he is such a nice guy, is not necessarily equal to the trust. Unless you’ve done in-depth due diligence on the broker, you know absolutely nothing worth knowing about him.
This case teaches two lessons. First, the securities industry observes no human morality. For players in the market, the only moral code is “‘good’ means more money for me. ‘Bad’ equals less money for me.”
This is not an unusual story. It happens every day. Right now, hundreds (more likely thousands) of stockbrokers are doing the same thing to their customers. They work for firms that are considered financial giants, whose impressive television commercials run on the most expensive time slots in television.
According to the U.S. Securities and Exchange Commission (“SEC”), Massachusetts-based State Street Bank and Trust Company (“State Street”) misled investors about the extent of subprime mortgage-backed securities in funds managed by State Street. Conservative investors who thought they were investing in money market equivalent funds wound up owning funds full of extremely risky subprime mortgages. According [...]
The U.S. Securities and Exchange Commission (SEC) claims that JP Morgan Securities bribed certain Alabama officials to hire the firm to assist with issuance of Alabama municipal bonds. The SEC claims that JP Morgan paid more than $8 million to close friends and relatives of certain Commissioners of Jefferson County, Alabama, and that, in return, JP Morgan [...]
According to a complaint filed by the U.S. Securities and Exchange Commission (SEC), Regions Bank (Regions) played a significant role in a scam that robbed 14,000 investors of millions of dollars from 1996 to 2008. Specifically, the SEC alleges that Regions served as trustee for mutual funds offered by two unregistered broker-dealers, U.S. Pension Trust Corp. and U.S. College [...]
SEC Charges Former LPL Financial Broker with Promissory Note Scam
Scam artists love to use promissory notes in these uncertain economic times because they seem more safe than a hedge fund investment. It’s all the same to the scam artist; there is no legitimate enterprise behind his sales pitch. So, he aims to sell you what he thinks you are most interested in buying.