Posts belonging to Category Investor Rights

SEC Receiver’s Plan is Unfair to Proactive Medical Capital Noteholders


In the Medical Capital Receiver case, the SEC Receiver recently filed the “Receiver’s Proposed Plan for Distribution” (the “Plan”) which contains some disturbing news for those investors who were pro-active and obtained recoveries against third-parties through litigation (including class actions) or arbitration. As proposed in the Plan (set forth on Page 14 section 4) the […]

Wells REIT II Finally Reports That Share Values Have Dropped More Than 25%


Wells Real Estate Funds, a major nontraded REIT seller, has announced that shares of its Wells REIT II, which investors purchased at a share price of $10, are actually worth an estimated $7.47 per share (“Share value of popular Wells REIT sinks,” InvestmentNews). Clients will see the reduction in the estimated account value on their […]

The 2007-2008 Financial Crisis was not a ‘Black Swan’ Event


Many commentators have noted recently that the Wall Street meltdown of 2007-2008 was not a “black swan” ? that is, an unprecedented and therefore unpredictable occurrence. Named for an influential 2007 book titled The Black Swan by investment fund manager Nassim Nicholas Talib, the black swan was used as a metaphor to explain why humans […]

Investors Prefer All Public Arbitration Panels


Since the Financial Industry Regulatory Authority (FINRA) amended its rules effective January 31, 2011 to allow investors who file securities arbitration claims to opt for an “all-public” panel with no ties to the securities industry (as FINRA defines “ties”), 77 percent of eligible investors have done so, according to Linda Fienberg, president of FINRA Dispute […]

Is the SEC Selectively Enforcing the Securities Laws?


Reuters blogger Felix Salmon seems to see evidence of the SEC colluding with banks to let them off the hook for most of their “built to fail” synthetic (derivatives-based) CDOs (see “Is the SEC colluding with banks on CDO prosecutions?”). What has raised eyebrows was an email from a Citigroup spokesperson saying that Citigroup has […]

Occupy Wall Street As A Global Phenomenon


Occupy Wall Street has swept the globe and is generating enormous sympathy and interest in Asia as well as Europe. The spread of Occupy Wall Street to Asia ? especially Japan ? is further evidence that it is a mistake to dismiss a global groundswell of anger over the flow of money from banks to […]

Raymond James’ Affiliates Gouge Investors


Raymond James affiliates have been ordered to pay $2.1 million in fines and restitution to more than 15,500 of its customers for overcharging them in 27,000 transactions. Raymond James customers paid nearly $1.7 million in excess commissions, according to the Financial Industry Regulatory Authority (FINRA). In addition, FINRA found that Raymond James’ supervisory systems were […]

Market Turmoil Expected to Precipitate an Avalanche of Suitability Claims


Just as a low tide near the seashore can reveal shipwrecks, a falling stock market often reveals misconduct by investment advisers. This is particularly true with respect to an investment adviser’s duty to recommend only investments to a customer that are suitable in light of the customer’s investment objectives, status in life and risk tolerance. […]

Investors Should Focus on Risk Tolerance during Turbulent Times


The recent political and economic instability reminds us that while there are some “black swan” risks that are out of an investor’s control, portfolios can and should be managed based on an investor’s risk tolerance. See Paul Sullivan’s recent New York Times article entitled “Managing an Investment Portfolio for Risks, Not Only Returns.”

Investors to Receive Some Compensation from Morgan Keegan Regulatory Settlements


Morgan Keegan & Company and Morgan Asset Management have agreed to pay $200 million to settle fraud charges related to proprietary bond mutual funds that were both mispriced and loaded with risky subprime mortgage-backed securities. Approximately 39,000 investors lost $1.5 billion in the RMK bond funds (later renamed Helios) that were the focus of the […]