The Securities Law Firm of Menzer & Hill, P.A. Announces Investigation Into The Sales Practices Of Broker-Dealers That Solici...
May 04 2012 - 4:11PM
Business Wire
The Securities Law Firm of Menzer & Hill, P.A.
(www.suemyadvisor.com) announced today that it has filed
arbitration claims and continues to investigate the sales practices
of brokerage firms that solicited investors to buy leveraged and
inversed Exchanged-Traded Funds (“ETFs”). Many brokerage firms,
through their financial advisors, have solicited purchases in these
securities as investments, with holding periods longer than one
day, while others are recommending option strategies on the
underlying ETFs.
The Financial Industry Regulatory Authority (“FINRA”), stated in
a Regulatory Notice, sent to brokerage firms June 2009, that
leveraged and inverse ETFs are “highly complex financial
instruments” and “are typically not suitable for retail investors
who plan to hold them for more than one trading [day], particularly
in volatile markets.” Brokerage firms that failed to adhere to
suitability requirements could be held liable to investors that
sustained losses in solicited purchases of leveraged and inverse
ETFs as a result.
On May 1, 2012, Citigroup was fined $2 million and ordered to
pay $146,431 in restitution. Wells Fargo was fined $2.1 million and
ordered to pay $641,489 in restitution. Morgan Stanley was fined
$1.75 million and ordered to pay $604,584, and UBS was fined $1.5
million and ordered to pay $431,488.
Investors that have purchased leveraged or inverse ETFs through
a brokerage account or managed account offered by Merrill Lynch, a
subsidiary of Bank of America (NYSE: BAC), Morgan Stanley Smith
Barney (NYSE: MS), Wells Fargo Advisors (NYSE: WFC), Ameriprise
Financial (NYSE: AMP), UBS (NYSE: UBS), LPL Financial, Raymond
James (NYSE: RJF), Edward Jones, or other brokerage firms and have
sustained losses should contact the attorneys at the Securities Law
Firm of Menzer & Hill, P.A. to determine if they have a claim
for a recovery of losses.
For a free case evaluation or to discuss any other investment
losses, please contact the Securities Law Firm of Menzer &
Hill, P.A., at 888-923-9223, or visit us on the web at
www.suemyadvisor.com.
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