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New Suitability Rule Seen Complicating Arbitrations

Dow Jones Compliance Watch

New rules on what makes a suitable recommendation for clients may also make it tougher for brokers who find themselves in arbitration over a client complaint. Brokers will have to take into account more details about each investor’s circumstances when making a recommendation, and that could give investors more legal ammunition–and arbitrators more issues to […]

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Two Provident execs hit with fines, bans

Investment News

Two co-founders of Provident Royalties LLC, which turned out to be a $485 million Ponzi scheme that caused severe losses for investors and wiped out dozens of independent broker-dealers, have been fined $50,000 each and suspended from the securities industry for two years, according to a settlement with the Financial Industry Regulatory Authority Inc. The […]

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Keeping Score: Investor Advocates Push for More Broker Disclosure, Including Grades on Exams

Wall Street Journal

When Michael Goldfeder took an exam in 1994 that allows brokers to sell securities, he says his goal was simple: pass the test. The Melville, N.Y.-based adviser succeeded—not by much, he concedes—but never dreamed his clients, or future prospects, might one day see his actual grade. “I’m not ashamed by any means, but it’s preposterous […]

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Schwab loses lawsuit to halt FINRA action


A federal court judge threw out a lawsuit by Charles Schwab Corp that had sought to stop its regulator from disciplining the brokerage for trying to take away customers’ rights to sue it in class actions. Magistrate Judge Elizabeth Laporte of the U.S. District Court for the Northern District of California late on Friday granted […]

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Wall Street’s Legal Magic Ends an American Right


American business entered its Teflon era on a spring day 25 years ago. Lawyer Madelaine Eppenstein had taken the morning off from work for a parent-teacher event at her 5-year-old’s elementary school on June 8, 1987, when she was summoned to the principal’s office for an urgent call. Her husband and law partner, Theodore Eppenstein, […]

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