Klayman & Toskes, P.A. Wins $2.25 Million FINRA Arbitration Award in Favor of Retired UPS Executive With Concentrated Stock P...
February 10 2016 - 1:56PM
The Securities Arbitration Law Firm of Klayman & Toskes, P.A.
(“K&T”), www.nasd-law.com announced a major victory today in
winning a significant $2.25 million award against Citigroup Global
Markets (NYSE:C) for FINRA securities arbitration Case No.
14-00199. The securities arbitration panel heard testimony
for six days in Atlanta, Georgia before an award in the amount of
$2.25 million was made in favor of a retired UPS executive,
represented by attorneys, Steven D. Toskes, Esq. and Raymond
Gentile, Esq. Citigroup has since paid the award. The
Claimant alleged causes of action related to Claimant's
concentrated position in UPS stock (NYSE:UPS) including: breach of
fiduciary duty; unsuitable investment strategy; failure to
recommend risk management strategies for a concentrated, leveraged
position; negligence and gross negligence; and failure to
supervise. Investors who suffered losses in concentrated stock
positions should consider what recourse is available to recover
their investment losses in stock held in full-service brokerage
accounts. The Financial Industry Regulatory Authority, (FINRA) is a
self-regulating organization with sales practice rules and
regulations that governs the securities industry's conduct to
protect the investing public.
According to founding partner, Steven D. Toskes,
“Our client worked over 37 years with UPS and accumulated shares
through UPS's Employee Stock Purchase Plan and Managers Incentive
Program. Citigroup loaned funds using UPS stock and other
securities as collateral but failed to implement a risk management
strategy to protect the concentrated stock.” Mr. Toskes
continues, “Any time a client has a concentrated, leveraged stock
position, the prudent practice is to protect the downside to
prevent a margin call through a risk management strategy such as a
prepaid forward contract, collar or protective put option.
This case was about the failure of Citigroup to protect our
client’s UPS stock which represented the vast majority of his life
savings.”
Concentrated stock positions represent a long
term holding acquired through investment, inheritance or as an
employee of the company. “Employees who participate in Employee
Stock Purchase Plans (“ESPP”) can be particularly susceptible to
concentrated stock positions and their respective financial
advisors should ensure that these positions are protected from
unforeseen market events by diversifying or hedging these positions
accordingly,” said Raymond Gentile, Esq. Full-service
brokerage firms are obligated to give, and investors are entitled
to rely upon, brokerage firms for competent, suitable investment
advice concerning risk management strategies for concentrated stock
positions. Brokerage firms are required to supervise the activities
in brokerage accounts, and losses may be attributed to the failure
to adequately supervise the financial advisor. Recommendations of
unsuitable investments and/or maintaining unprotected concentrated
stock positions are both causes of action that may be available to
investors against their full-service brokerage firm in an
individual securities arbitration claim filed with FINRA.
About Klayman & Toskes,
P.A.K&T is a leading securities law firm which
practices exclusively in the field of securities arbitration and
litigation, on behalf of retail and institutional investors such as
non-profit organizations, public and multi-employer pension funds
in large and complex securities matters. The Firm has offices in
California, Florida, New York and Puerto Rico. Investors who have
suffered investment losses from concentrated stock positions and
the failure to implement risk management strategies should contact
Steven D. Toskes, Esq. at 888-997-9956.
Destination: http://nasd-law.com/klayman-toskes-p-a-wins-2-25-million-finra-arbitration-award-in-favor-of-retired-ups-executive-with-concentrated-stock-position-against-citigroup-global-markets-2/
Contact Information:
Klayman & Toskes, PA
Steven D. Toskes, Esq.
888-997-9956
stoskes@nasd-law.com
www.nasd-law.com
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