New NASD Proposal will require more disclosures by retail brokers. The war on analysts is now threatening brokers. In proposing heightened disclosures from analysts, the NASDR has included retail brokers as well. The July proposal, NASD Notice to Members 01-45, broadens disclosure obligations for public appearances by analysts and brokers […]
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NASD Issues Investor Alert on Stretch IRAs
By Mark J. Astarita, Esq. August 10, 2001 – in the section of its web site labeled “Investor Alerts” the NASD has issued a warning regarding so called “stretch IRAs”. A stretch IRA stretches the period of tax deferred earnings of assets within an IRA beyond the lifetime of the […]
NASD Extends Margin Disclosure Deadline
By John M. Baker, Esq. NASD Regulation announced on May 27, 2001,an extension to the deadline of the margin disclosure statement requirement for existing customers: For those non-institutional customers who were margin customers of the firm prior to June 4, 2001, members are required to provide the disclosure statement, […]
SEC Position on Mutual Fund Fair Value Released
New Obligations for Mutual Fund Directors? By John M. Baker, Esq. The staff of the Securities and Exchange Commission recently issued an interpretive letter on the obligation of investment companies and their directors to determine in good faith the fair value of the funds’ portfolio securities when market quotations are […]
SEC Allows 401(k) Plan as Qualified Investor
SEC Allows 401(k) Plan as Qualified Investor Staff changes view on status of certain plans for investment company exemption By John M. Baker, Esq. Section 3(c)(1) of the Investment Company Act of 1940 generally excludes from the definition of “investment company” any issuer whose securities are owned by not more […]
Arbitration Agreements and Enforcement
To Compel Arbitration, Must Prove Knowing Acceptance of the Agreement This time, merely proving that the agreement was signed was not enough. Braga v. VMR Capital Markets, No. B144584 (Cal. App., 2Dist., 2/13/02). Arbitration Agreement * Contractual Issues (Mutual Assent) * Waiver * State Law, Applicability of * FAA (Section2). […]
Attempt to Void Settlement
Arbitration Panel Orders Return of Settlement Payment, and Awards Nothing. WEINBERG v. BEAR STEARNS & CO., INC., NYSE ID #2000-008216 (Los Angeles, 10/18/00): Recently confirmed, this Award presents an unusual outcome in a “two-bites-of-the-apple” scenario. According to the “Case Summary” section of the Award, Israel and Molly Weinberg entered into […]
Report on Mutual Fund Fees and Expenses Released
Rise in fees noted and explained By John M. Baker, Esq. January 10, 2001 – The SEC‘s Division of Investment Management today released its Report on Mutual Fund Fees and Expenses (December 2000). The report finds that fund expenses ratios rose on average during the last 20 years, although […]
Broker and Supervisor Liable for Customer Conduct
Failing to Stop Wash Sales and Matched Orders Leads to Disciplinary Proceedings By John M. Baker, Esq. The U.S. Court of Appeals for the D.C. Circuit on Friday affirmed an SEC order finding a registered representative and her supervisor responsible for a customer’s improper trades. Graham v. SEC, No. 99- […]
Prime Bank Fraud Action by SEC
Another Prime Bank Fraud Action Commenced by SEC December 20, 2000. The SEC announced today that it filed an action against Phillip Ezell, a resident of Fort Wayne, Indiana, for offering fictitious “prime bank” instruments over the Internet from March 1998 to August 2000. The Commission alleges that Ezell, doing […]
