N.J. couple pays dearly for financial advice

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N.J. couple pays dearly for financial advice

By Karin Price Mueller/The Star-Ledger

January 05, 2010, 7:00AM
JENNIFER BROWN/THE STAR-LEDGER Claire and Alex Moskvin of West New York sold their home and entrusted the proceeds to a broker at Wachovia, which is now Wells Fargo. They told him to invest conservatively, but he ended up losing nearly $227,000, they say. They have filed a complaint.

Stock market losses were rampant in 2008 and the start of 2009, and very few investors escaped unscathed.

But Claire and Alex Moskvin of West New York contend they never should have seen losses — any losses — in the nest egg they entrusted to a Wells Fargo (formerly Wachovia) broker.

"We were expecting him to keep our money safe for a period of one or two years because we wanted to buy a house," Claire Moskvin said.

Instead, the account lost $226,865.86 from May 2008 to March 2009.

How it all happened

The Moskvins sold their home in April 2006, and they wanted to invest the proceeds conservatively. They purchased certificates of deposit and principal-insured municipal bonds with their $975,000 in a J.P. Morgan-Chase account, but they weren’t happy with the customer service.

On the recommendation of a friend, they turned to Eric Kleiner, a registered representative, or broker, with Wachovia. (Wachovia was later bought by Wells Fargo, which is Kleiner’s current employer.)

In December 2007, according to a complaint filed by the Moskvins with the Financial Industry Regulatory Authority, they met with Kleiner to discuss a short-term investment strategy for the money.

"During this meeting, they informed him that they were looking to preserve the capital they had acquired through the sale of their house for approximately one to two years, at which point they anticipated purchasing a new home," said the complaint. "Additionally, Mr. and Mrs. Moskvin expressed their concerns regarding news reports they had heard concerning an impending economic downturn."

The Moskvins, who admit their investment knowledge is limited, said they asked about principal-insured municipal bonds and Treasuries, but Kleiner instead created a portfolio of mutual funds. The Moskvins trusted his recommendations.

Shortly thereafter, the market started to tank, as did the Moskvins’ house fund.

The Moskvins were worried. Very worried. They said they turned to Kleiner.

"He continually reassured us the account was on track, that we were in a perfect investment for the time frame we wanted and not to worry, not to watch it," Claire Moskvin said.

But the couple did watch the decline, and continued to contact Kleiner — almost daily through July and August 2008, they said. Each time he said not to worry. They asked if they should liquidate the portfolio to stop future losses. He said that would be foolish, according to the complaint.

The Moskvins contacted Kleiner’s branch manager in November 2008, and they were told again not to worry.

In December 2008, they talked to Jackie Ellis, a client resolution specialist for the company. An investigation was initiated, and on March 2, Ellis sided with Kleiner, the complaint said.

Thinking they had no alternative, the Moskvins liquidated their account on March 6, losing $226,865.86.

And they called a lawyer.

The complaint

The Moskvin’s attorney, Stuart Meissner, said Kleiner used a "one-size-fits-all" approach for his clients, disregarding their short-term time horizon while misleading them about commissions and his status as an independent investment adviser.

They also allege something fishy was going on with the account opening documents signed by the Moskvins. On the investment objective page, the box for "growth and income" was checked. The spot for a client signature is on another page, and the Moskvins said they never checked the "growth and income" box, nor do they remember ever discussing the terminology with Kleiner. The couple said their objective was "capital preservation," something they said they told Kleiner over and over.

"If you look at where the funds came from, all CDs and government-backed securities, they’re conservative any way you slice and dice it," Meissner said.

Meissner said if the portfolio was invested in a short-term conservative benchmark such as the Barclay’s Aggregate Bond Index, it would have earned more than $29,000 over that time period, rather than lose nearly $227,000.

Arbitration has been scheduled for May. The Moskvins are asking for the return of their lost principal, punitive damages, interest and attorney’s fees.

"We’re devastated and we feel we were misled in our trust that we put in this man," said Claire Moskvin. "It’s a terrible feeling of betrayal and it’s been extremely stressful. We wouldn’t wish it on anyone."

Complaints are on the rise

Kleiner did not return Bamboozled’s repeated phone calls, and Wells Fargo refused to comment on the case.

According to FINRA, there is one "pending" complaint against Kleiner (the one filed by the Moskvins) and one that’s listed as "final," in which a client questioned the tax consequences of a stock sale.

Complaints against brokers are on the rise in the wake of the stock market’s 2008-09 fall. There were 50 percent more complaints during the year ending November 2008 compared with the year before (6,601 vs. 4,413), according to FINRA. Last year, the most popular complaints were misrepresentation, unsuitability, negligence and breach of fiduciary duty.

But what about this specific portfolio? Bamboozled took a closer look using the Morningstar.com Portfolio X-Ray tool. We plugged in the investments to check the asset allocation. The breakdown: 16 percent U.S. stocks, 22 percent foreign stocks, 58 percent bonds, 22 percent cash, 2 percent "other" and 12 percent "not classified."

Bamboozled wanted to see what other advisers thought of this portfolio for a couple who needed the money for a short-term home purchase.

"I would have to categorize it between moderate and aggressive," said Jerry Lynch, a certified financial planner with JFL Consulting in Fairfield. "I would use this with a minimum five-year horizon, but I would prefer longer."

Because most of the investments are "C" shares, there is a 1 percent annual commission built in for the adviser on top of management fees, which increases the overall cost of the funds, Lynch said. For example, on a $500,000 investment, the adviser would receive $5,000 — not once, but each and every year for the life of the investment.

Lynch said for a "capital preservation" objective, he’d stick with a very conservative investment platform, mainly with cash and ultra-short duration high-quality bonds.

A money market or certificate of deposit would be the way to go, said Michael Gibney, a certified financial planner with Highland Financial Advisors in Riverdale.

"If someone has a time frame of less than three years, we advise them to be fairly liquid," he said.

Protecting yourself

We’ll see what the arbitration panel decides in May. But in the meantime, the Moskvins’ experience can serve as a lesson to all investors.

Never hand over your money completely. If you find an adviser you’re comfortable with — and most advisers are ethical, reputable and well worth the fees they earn — absolutely listen to his or her advice about what investments are best for your goals and time horizon.

Check out an adviser before you hand over your money. Use FINRA BrokerCheck (finra.org) or call (800) 289-9999 to see if there are any complaints about the adviser.

But you have to do more.

Ask about fees. If an adviser recommends a high-commissioned investment, ask why it’s worth the extra fee. If you’re getting something for your money, fine. If you’re not, ask about lower cost and no-load investments, or find another adviser.

If you feel you’re not savvy enough, ask questions until you understand. A reputable adviser should explain, explain and explain again.

Research online. Read books. Go to an investment seminar. And ask more questions. Never stop asking questions.

Wet_Blanket's picture
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WTH - that portfolio allocation adds up to 132%. 

skbroker's picture
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500k in c share?   Really?

Wet_Blanket's picture
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skbroker wrote:500k in c share?   Really?
 
Shorterm investment timeline?  I think the one CFP quoted is a bit Hitlerish by labeling that "Moderate to Aggressive" unless the 58% bonds 22% cash isn't accurate.  Of course, I wouldn't consider it cap pres either.

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I'd like to hear the real version of how that  broker /client meeting went down.
 
 

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No matter how you slice and dice it, the msot aggressive investment these people should have had would be a short-duration muni fund (or SD govie).  Beyond that, CD's, MMKT, etc.  I have had several clients in similar situations (lot of people with large severance packages, inheritances, money to pay for pending education expenses, etc.) where the money is being earmarked for a very near-term purpose.  I typically don't even invest money in the stock market for anything under 5-7 years.  Even if the FA was confused about how quickly they needed the money, the worst he should have done was had them in long-term bonds.  But equities?  That's just dumb.
Obviously we're only hearing one side of the story, but it's pretty hard to mess something like this up, and you only need to ask the client a few basic questions.  "What's the money for?  When do you need it?"  That should have ended it right there.
Stupid.

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mlgone wrote:
 
Who says people don't need advisors?
 
I would say this couple didn't need a FA (for this specific situation), just some CDs.

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They purchased certificates of deposit and principal-insured municipal bonds with their $975,000 in a J.P. Morgan-Chase account, but they weren’t happy with the customer service.

liar

but they weren’t happy with the customer service. (oh palezzz)

During this meeting, they informed him that they were looking to preserve the capital they had acquired through the sale of their house for approximately one to two years, at which point they anticipated purchasing a new home,

liar

They also allege something fishy was going on with the account opening documents signed by the Moskvins. On the investment objective page, the box for "growth and income" was checked. The spot for a client signature is on another page, and the Moskvins said they never checked the "growth and income" box, nor do they remember ever discussing the terminology with Kleiner. The couple said their objective was "capital preservation,"

liar

The Moskvins, who admit their investment knowledge is limited, said they asked about principal-insured municipal bonds and Treasuries

liar

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Shania Twain wrote:They purchased certificates of deposit and principal-insured municipal bonds with their $975,000 in a J.P. Morgan-Chase account, but they weren’t happy with the customer service. liar During this meeting, they informed him that they were looking to preserve the capital they had acquired through the sale of their house for approximately one to two years, at which point they anticipated purchasing a new home, liar They also allege something fishy was going on with the account opening documents signed by the Moskvins. On the investment objective page, the box for "growth and income" was checked. The spot for a client signature is on another page, and the Moskvins said they never checked the "growth and income" box, nor do they remember ever discussing the terminology with Kleiner. The couple said their objective was "capital preservation," liar

Shania Twain:
How would you know? Were you there?
Jack Black

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JackBlack wrote:
Shania Twain:
How would you know? Were you there?
Jack Black

nope was not there.
would bet my life they full of crap

sell "CD's and insured munis" because of "poor service" and go request CD's and munis from someone else?

gimmie me a fukcing break.

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Mr financial advisor I would like to invest my money in a principle guarantee investments because I would like to purchase a home in few year. What do you recommend?

Fa. Well. I think we should invest 40 percent in stocks and 60 percent in bonds because everyone knows stocks and bonds are guarantee investments

Client.   Great. Let do it

I hate these f***in clients

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Shania Twain, or should we call you...........(pause for dramatic effect)............................
 

ERIC KLEINER!  *Gasps break out around the room*

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Wet_Blanket wrote: Shania Twain, or should we call you...........(pause for dramatic effect)............................
 

ERIC KLEINER!  *Gasps break out around the room*

not him.

these people probably flipped that house. thought real estate toppy.
looking for a pop in the market and then take another shot at flipping a house

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I see your point about buying at one firm, liquidating and moving to another, because of CS.

trailman's picture
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The advisor should have bought them auction rate securities!

clang's picture
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I agree with ST. clients version smells like a fresh steamer.
when client heard rates on Kleiner's cd was not better than Morgans, he wanted something "better".
 
then client watched too much cnbc and suzie ormand. hit the bid at worst possible time.

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Wet_Blanket wrote:WTH - that portfolio allocation adds up to 132%. 
 
Some allocation breakdowns put certain investments into 2 catergories.  Like an income fund may fall under income and G&I.
 
...maybe.
 
Yeah this couple sounds like a real turd sandwich.  At any point during the asset allocation discussion they could have said:
 
  "no, I don't want mutual funds."
 
                    or
 
  "are mutual funds conservative?"
 
 
                    or
 
 
   "can mutual funds lose money?"
 
 
 
 
                     or
 
 
   " I'm not smart enough to tie my shoes... I want principal guaranteed muni bonds."
 
 

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Ridiculous.  I had a client file a complaint as well about a  year ago.  10 days after they arrested Madoff.  People are idiots.

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Wet_Blanket wrote:WTH - that portfolio allocation adds up to 132%. 

 
 
That's the first thing that struck me.......That the total added up to more than 100%.
 
Plus, if they called daily throughout July and August, then I'm sorry but somewhere along the line, some of the investments should have been sold.......Not all of them, but some of them......
 
If you have a client calling you on a daily basis, you know that:
 
1- They will continue to call daily as the market heads lower, so you should take some action........just to make them feel like you are taking action.......Becoming more conservative, obviously.....
 
2- The manager was involved.......speaking to them......hearing their dissapointment and fear......which should have also triggered a round of selling.......getting more conservative......
 
When I have clients call me because they are scared, I can reassure them that they are invested well, in good funds, etc........BUT, if they call daily for 2 months, then there would have been a pretty big move to short term funds.........Just to minimize the calls.......
 
This couple might very well be full of sh*t, but they have a case........and ultimately, in this day and age, the FA's career will probably be hurt by it......

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Shania Twain wrote:N.J"During this meeting, they informed him that they were looking to preserve the capital they had acquired through the sale of their house for approximately one to two years, at which point they anticipated purchasing a new home," said the complaint. "Additionally, Mr. and Mrs. Moskvin expressed their concerns regarding news reports they had heard concerning an impending economic downturn."
 
My ass. 

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SFEZ wrote:
This couple might very well be full of sh*t, but they have a case........and ultimately, in this day and age, the FA's career will probably be hurt by it......

suitable, docs legit, diversified.
I bet they get zero.

here is the lovley couple.
they sent this story to something called "Bamboozeled"
poor people.    helpless

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Shania Twain wrote: SFEZ wrote:
This couple might very well be full of sh*t, but they have a case........and ultimately, in this day and age, the FA's career will probably be hurt by it...... suitable, docs legit, diversified. I bet they get zero. here is the lovley couple. they sent this story to something called "Bamboozeled" poor people.    helpless

 
 
Look, they called the FA almost daily throughout July and August.......
They called the branch manager in November.......
They called a client resolution specialist (compliance?) in December.....
 
In all cases it seems that nothing was sold.......as the account value continued to go lower month after month.....
 
I'm not saying the initial allocation was wrong.......or that the clients aren't full of sh*t about their lack of knowledge.......BUT, if you have a high number of calls, spread throughout different people......and nothing was done......Then, I'm sorry to say, teh checkpoints that are in place failed......
 
 
 

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"Additionally, Mr. and Mrs. Moskvin expressed their concerns regarding news reports they had heard concerning an impending economic downturn."
Does anybody remember reading news reports of an impending economic downturn back then?  There were a few, but not many.
 
I'd love to interview the FA at JPM to see what he recalls about his conversations with these people before the transferred their account to WS.  I'm sure he would either corroborate their story about being primarily concerned about safety of principal or completly blow it out of the water and say they wanted equities for short term investing - one extreme or the other.
 
I'd also love to see a hypo of what their exact investments would have done had they not sold one day away from THE bottom.
 
Either way, if the repeated calls can be verified, they have a valid case. 

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mlgone wrote:So they were down 23% (if it was all invested). 
 
"Thinking they had no alternative, the Moskvins liquidated their account on March 6, losing $226,865.86."
 
 
Geez............just right about at the low on the S&P (March 9).   Probably missed the entire rebound.......
 
Who says people don't need advisors?
You got that right. I'm betting the author is failing to mention that if the clients had waited the timeline they indicated - two years - they would have come out just fine.
 
That said ... the advisor got what he deserved. You move financially mental midgets from CDs to a portfolio including equities in a two year timeframe ... you got rocks in your head.

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SFEZ wrote: Shania Twain wrote: SFEZ wrote:

In all cases it seems that nothing was sold.......as the account value continued to go lower month after month.....
 
I'm not saying the initial allocation was wrong.......or that the clients aren't full of sh*t about their lack of knowledge.......BUT, if you have a high number of calls, spread throughout different people......and nothing was done......Then, I'm sorry to say, teh checkpoints that are in place failed......
 
 
 

I do not think calling in etc means anything legally. I actually think it would work to their disadvantage.

Why did you not sell then?

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LockEDJ wrote: mlgone wrote:So they were down 23% (if it was all invested). 
That said ... the advisor got what he deserved. You move financially mental midgets from CDs to a portfolio including equities in a two year timeframe ... you got rocks in your head.

These are not financially mental midgets. These are calculated people. (look at the guy.   bet he has an Armani knock off suit from Sims)

No personal responsibility.

get what you can
anyway you can

Got into market at wrong time. call a trial lawyer. make stuff up

its America

In my opinion

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They called daily thru July and August? Please.
 
you call me 3 days in a row bitching, I blow you out of everything.
 
 and this broker had the patience to listen to them for 60 straight days ? i doubt the veracity of their story.
 
i.e bullsh!t.

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Shania Twain wrote: SFEZ wrote: Shania Twain wrote: SFEZ wrote:
In all cases it seems that nothing was sold.......as the account value continued to go lower month after month.....
 
I'm not saying the initial allocation was wrong.......or that the clients aren't full of sh*t about their lack of knowledge.......BUT, if you have a high number of calls, spread throughout different people......and nothing was done......Then, I'm sorry to say, teh checkpoints that are in place failed......
  I do not think calling in etc means anything legally. I actually think it would work to their disadvantage. Why did you not sell then?

 
Calling in does mean something........no doubt.......
 
For starters, if a client calls you to complain about the market, that they are scared and are thinking of selling everything.......your first reaction is probably to calm them down, remember their time horizon, and assure them they are in good, solid investments that have good track records......
 
BUT, if they continue to call in.......day after day (or even 2x per week), for 2 months straight, then I'm sorry, but you MUST take action.......even if you think that the investments will come back......you MUST become more conservative in that case....
 
Does that mean to sell everything? NO........
But, it should trigger a concern that these people's current concerns need to be addressed......and then, later on......you can choose to dump them as clients.......But, at the time, you have to address the situation, and move some stuff out of risk and into safer investments.....
 
Even if they are full of sh*t, Even if you are in 5 star funds, even if you are in investment-grade fixed income........When they call and question suitability, you have to dot all your i's and cross all your t's.......I don't think that was done here.....
 
That's my opinion........

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"We’re devastated and we feel we were misled in our trust that we put in this man," said Claire Moskvin. "It’s a terrible feeling of betrayal and it’s been extremely stressful. We wouldn’t wish it on anyone."

oh palezzzzzzz.

You flip NJ house for a million. I bet they made a ton.

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Sfez, during the darkest days of the bear mkt, did you have clients call you DAILY wanting out. for 60 straight days. 30 straight days. 10 straight days. prob not, cause you would have sold out after the 5th or 6th call.
 
thats why those daily calls to that broker never happened. unless kleiner's first name is Job.
 

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clang wrote:Sfez, during the darkest days of the bear mkt, did you have clients call you DAILY wanting out. for 60 straight days. 30 straight days. 10 straight days. prob not, cause you would have sold out after the 5th or 6th call.
 
thats why those daily calls to that broker never happened. unless kleiner's first name is Job.
 
 

I agree........I would get them out (of at least some or most of their risk) after a few calls.....no doubt.....I might think they were totally wrong, but I would do it
 
But, the story claims that they then spoke to the branch manager and the client resolution specialist (sounds like compliance to me)........
 
How do you explain it getting that far without the account being liquidated......
 
I never had a client initiate a call to my BM........If I sensed a problem, the priority was to nip it in the bud.......Not defend my investment choices by insisting they hold.......

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Shania Twain wrote: LockEDJ wrote: mlgone wrote:So they were down 23% (if it was all invested). 
That said ... the advisor got what he deserved. You move financially mental midgets from CDs to a portfolio including equities in a two year timeframe ... you got rocks in your head. These are not financially mental midgets.In my opinion
 
Maybe I misspoke. They claim to be financial novices. Maybe they are most conniving jerkoffs this side of Bernie Madoff. It doesn't matter.
 
Their complicity does not free the financial advisor from engaging his brain at some point in this setup. I stand by what I said. The FA's an idiot and he got greedy. Seven figures does that to you.

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My prediction:  They will get money in a settlement with the firm, unless the FA has some fecking AMAZING evidence.

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Wet_Blanket wrote: My prediction:  They will get money in a settlement with the firm, unless the FA has some fecking AMAZING evidence.
Your compliance, so let me ask you ... let's assume Wachovia has some sort model that shows it fits their risk tolerance profile. You'd have to think that, if the OM took the call and cleared the FA.

These jobbers said they had a two year window. That's December, 2009 and I'm pretty darn sure that portfolio recaptures it's losses by last month. They bail before hand, doesn't that make them at least partially to blame? I'm asking, not be sarcastic or anything.

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LockEDJ wrote: Wet_Blanket wrote: My prediction:  They will get money in a settlement with the firm, unless the FA has some fecking AMAZING evidence. Your compliance, so let me ask you ... let's assume Wachovia has some sort model that shows it fits their risk tolerance profile. You'd have to think that, if the OM took the call and cleared the FA. These jobbers said they had a two year window. That's December, 2009 and I'm pretty darn sure that portfolio recaptures it's losses by last month. They bail before hand, doesn't that make them at least partially to blame? I'm asking, not be sarcastic or anything.
 
That is difficult to say.  On the one hand, this happened during the worst financial meltdown since the Great Depression - which has caused every compliance officer to serious rethink what is suitable.  When I got into compliance, the general rule was that an "aggressive" investor can stomach a 20% loss (which I laugh at now).  Odds are Wachovia had a suitability alert system that is based on standard deviation of the investments, and odds are that measurement was thrown out the window with how messed up the markets were.  So Yes, Wachovia could have thought the portfolio was suitable (based on their model), but clearly it wasn't.
 
But I can't say any of this mess is their fault, with what has been presented in the article.  As compliance, we want FAs to look for red flag behavior and get a good since of their client.  The fact that these clients finally had enough and sold at the lowest part of the market was predictable behavior for people with that risk tolerance and investment goals.
 
Now if they lied about their goals, and Wachovia had supporting documentation (like an Investor Questionnaire), then that goes a long way.
 
So from a compliance perspective, if everything stated in the article is accurate, then the guilty parties are 1) the FA for suitability and 2) Wachovia for failure to supervise.  (I could have overlooked other issues).

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During this meeting, they informed him that they were looking to preserve the capital they had acquired through the sale of their house for approximately one to two years, at which point they anticipated purchasing a new home,"
 
Nothing but cash equivalents would have been appropriate in the eyes of FINRA.  Maybe a super short duration treasury fund. That would be it.  But it boils down to he said/she said.  Who can prove what.

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This would not be an a problem if the client made 20 percent in the market. Every client wants 20 percent annual return with no downside

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Thanks, Wet. I can see where I was going with my line of reasoning was off-base.

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A senior exec @ IFF a NOVICE?

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people do not read what we shove in front of them; I  bet they signed off on all the risk disclosures etc and they will get ZIP

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Bud Fox wrote:During this meeting, they informed him that they were looking to preserve the capital they had acquired through the sale of their house for approximately one to two years, at which point they anticipated purchasing a new home,"
 
Nothing but cash equivalents would have been appropriate in the eyes of FINRA.  Maybe a super short duration treasury fund. That would be it.  But it boils down to he said/she said.  Who can prove what.
 
Have to agree with Finra on this one... Two years and they wanted to use the money to buy a house... nothing but cash, cds, treasuries is where I would have put the money...My question is... That is what they had set up at JP Morgan, why change?

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chief123 wrote:
Have to agree with Finra on this one... Two years and they wanted to use the money to buy a house... nothing but cash, cds, treasuries is where I would have put the money...My question is... That is what they had set up at JP Morgan, why change?
They changed brokers because of "service" levels. Which, to me is code for "the advisor wasn't making enough money for me". Either they refused to listen, or in the greed and haste of the Wach broker, he failed to clearly tell them what making increased returns entailed.
 
I'm guessing the latter. The rep knew the people didn't understand, didn't want to pass up on the deal, and pushed through what he knew was a bit leaky.

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I agree.  Document everything.  If you have a particular client that seems like they could potentailly go down this road, write up a summary of all conversations and decisions made and provide it to them.  Extra points if they sign it.  Also, be extra careful to document when they don't take your advice.

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Since we are only hearing one side of the story everything is guesswork.  My opinion:
 
1- The comment that in April of 06 they heard the economy was on the verge of collapse is complete BS!  I cannot remember one major media outlet saying anything even close to that fact and if they did they were wrong.  The market peaked a year and a half later!!  
 
2- So for 18 months they saw the account go up by 10-20% and they never said "hey this is going up alot more than a CD, what gives?"
 
3- Did they say to the advisor exacly what they claim?  If so fry him!  BUT, chances are they said something to the effect of "we sold our investment property and think the market has peaked, we are somewhat conservative, we are gettting these rates on CD's which are terrible.  What can we do better?"
 
4- I'm sorry, but the days of a broker buying equity funds for a client who asked for CD's and safety without first convincing them to give it a shot are over.  There is absolutely nothing wrong with working with a client to model their risk profile.  If a 35 yr old came into your office and said I want to roll 6 month CD's in my roth for the next 30 years because I am conservative- would you just say OK done, or hey lets talk about risk/reward/time.  If a client comes in your office and says "I want safety of principal" and your show them all of the relavent articles talking about inflation, taxes, performance over time etc and they change their mind to a moderate growth strategy and sign a document to that effect, are you wrong?  Did you act improperly for helping them understand the different typres of risk and their effects on financial assets?
 
5. They last the whole way down w/o saying "that's it SELL" until the VERY bottom?  BS!  I had quite a few people call me that week saying "sell" or "I'm scared", only one did sell and they later appologized and gave me more money (they finally went back in 2 months later).  These people panic sold and then saw everything recover realizing they messed up- arb was their only way out.
 
This is a he said she said argument.  They were probably both wrong to some degree.  What is total bs is they went to the media BEFORE going to arb- That might hurt them in the end...

newbroker's picture
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Exactly, they flip that house for $1,000,000 but did they inform the buyer of the impending downturn.  These people now have a house worth $500,000.  Perhaps they should sue the Moskvins.
 
Also what is a principal protected muni bond?  When all of the insurance blewup munis went down in value too.

shantom1's picture
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newbroker wrote:Exactly, they flip that house for $1,000,000 but did they inform the buyer of the impending downturn.  These people now have a house worth $500,000.  Perhaps they should sue the Moskvins.
 
Also what is a principal protected muni bond?  When all of the insurance blewup munis went down in value too.

 
Closest thing is a Pre-Re.....

Ron 14's picture
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newbroker wrote:Exactly, they flip that house for $1,000,000 but did they inform the buyer of the impending downturn.  These people now have a house worth $500,000.  Perhaps they should sue the Moskvins.
 
Also what is a principal protected muni bond?  When all of the insurance blewup munis went down in value too.
 
 
 - nice catch !!

Shania Twain's picture
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Joined: 2009-09-23

Bud Fox wrote: [=#0000cc]  But it boils down to he said/she said.  Who can prove what.

exactly

they get zero.

Shania Twain's picture
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borei wrote: A senior exec @ IFF a NOVICE?

exactly

Shania Twain's picture
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newbroker wrote: Exactly, they flip that house for $1,000,000 but did they inform the buyer of the impending downturn.  These people now have a house worth $500,000. 

Perhaps they should sue the Moskvins.

haha great call

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