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| 2001 News and Press Releases |
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HEADLINE ARCHIVED:
Sue Your Broker - When Overzealous Brokers Met Newly Minted Investors In The Long Bull Market, Fortunes Were Made and Lost In An Instant. Now Everyone's Pointing Fingers Over The Missing Money
By: Amy Fledman
Money Magazine. Monday, October 1, 2001
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Excerpt: Since stocks peaked in March of last year, investors in the U.S. market have lost $4 trillion in paper wealth. That's an awful lot of money, and it's left an awful lot of people pissed off--and looking for someone to blame. Their targets: brokers and financial advisers. Across the country, investors are filing claims in record numbers. In the first seven months of this year, arbitration claims with the National Association of Securities Dealers, the primary forum for these cases, soared 25% from the same period a year ago, to 3,950, nearly double the amount filed in 1990. Less formal complaints to theSecurities and Exchange Commission jumped to 27,920 in 2000, a 58% increase from 1995. The total dollars claimed are rising too. The average case against a top 10 brokerage that completed arbitration surpassed $500,000 last year, compared with $370,000 five years earlier. "Million-dollar complaints are increasingly common," notes Beverly Hills attorney Phil Aidikoff. Confirms insurance executive Kathy Jacobson at the Seabury & Smith unit of Marsh & McLennan: There is a "very substantial" rise in negligence claims and payouts, affecting brokerages large and small. And if all that isn't enough, there's more: --In the first seven months of this year, more than 100 class- action securities suits were filed alleging abuses by brokerages in their allocations of IPOs, according to Stanford Law School's Securities Class-Action Clearinghouse.
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