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AFTER SEVERAL WEEKS OF DISCUSSION WITH CLIENT REGARDING OPTION STRATEGY, CLIENT AND HIS WIFE (ALSO A CLIENT) FURTHER DISCUSSED AND AUTHORIZED IMPLEMENTATION OF OPTION STRATEGY WITH FA ON A MONDAY NIGHT AND AGAIN AUTHORIZED TUESDAY MORNING,PRIOR TO OPENING,EXECUTION OF STRATEGY WITH OPTION CONTRACTS WITH STRIKE PRICES CLOSEST TO MARKET PRICE OF UNDERLYING STOCK. MONDAY EVENING NEWS CREATED SIGNIFICANT DECLINE IN MARKET PRICE OF UNDERLYING STOCK BETWEEN MONDAY CLOSE AND TUESDAY OPENING. ON TUESDAY MORNING, PRIOR TO ENTERING THE ORDERS, FA INFORMED WIFE/CLIENT OF THIS OVERNIGHT NEWS AND THE MOVEMENT OF THE PRICE OF THE STOCK, AFTER WHICH SHE AUTHORIZED EXECUTION OF THE OPTION STRATEGY AT LOWER STRIKE PRICES CLOSE TO THE MARKET PRICE OF THE UNDERLYING STOCK.
Damage Amount Requested
$300,000.00
Damages Granted
$5,000.00
Broker Comment
THE CLIENT'S DEMAND FOR RELIEF AT THE ARBITRATION EXCEEDED $226,311.00. THE ARBITRATION PANEL AWARDED THE CLIENTS $5,000.00 AND TAXED $6,412.50 IN COSTS AGAINST THEM, RESULTING IN NET AWARD OF -$1,412.50.
6/28/2001
Customer Dispute
Award / Judgment
Allegations
ALLEGED UNAUTHORIZED PURCHASE OF SECURITY & SUBSEQUENT POOR PERFORMANCE.
A brokerage firm, also called a broker-dealer, is in the business of buying and selling securities – stocks, bonds, mutual funds, and certain other investment products – on behalf of its customer (as broker), for its own bank (dealer), or both. Individuals who work for broker-dealers - the sales personnel are commonly referred to as brokers.
IA
Investment Adviser
An investment adviser is paid for providing advice about securities to clients. In addition, some investment advisers manage investment portfolios and offer financial planning services.
Disclosures
Disclosures can be customer complaints or arbitrations, regulatory actions, employment terminations, bankruptcy filings and certain civil or criminal proceedings that they were a part of.
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Disclosures can be customer complaints or arbitrations, regulatory actions, employment terminations, bankruptcy filings and certain civil or criminal proceedings that they were a part of.