FINRA Investor Alert on Bond Liquidity

By: Jason Robinson, Summer 2015 Graduate Research Assistant

The Financial Industry Regulation Authority (FINRA) recently issued an Investor Alert entitled Bond Liquidity—Factors to Consider and Questions to Ask. A liquid investment is one that can be bought and sold easily without a significant change in the price of the asset. According to FINRA, investors should realize that the market for bonds, unlike the stock market, is not “instantly liquid, and some bonds are easier to trade than others.” It is important that bondholders consider the risks associated with selling a bond before it matures as well as the factors that put pressure on bond liquidity. Continue reading

FINRA Investor Alert on Transfer of Brokerage Account Assets Upon Death

By: Jason Robinson, Summer 2015 Graduate Research Assistant

The Financial Industry Regulatory Authority (FINRA) recently issued an Investor Alert entitled Plan for Transition: What You Should Know About the Transfer of Brokerage Account Assets on Death. The alert provides investors with useful tips concerning estate planning for non-retirement accounts. Continue reading

Sneak Peak of the New Clinic Space

We are still unpacking the Investor Advocacy Clinic after the entire Georgia State University College of Law moved to our brand new building at 85 Park Place.  The Investor Advocacy Clinic has joined the College of Law’s HeLP and Low Income Taxpayer clinics in a new, two story clinical center.

While we haven’t completely settled in yet, we wanted to share a few photos of the new space, still in progress.  Let us know what you think.  After the dust settles in a few weeks, we would be happy to show you around.

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One of our several new client interview rooms.

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Common break room near clinical center kitchen

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One of seven student work rooms shared by the IAC and HeLP clinics. Each workroom accomodates at least four students.

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Additional view of student workroom.

The Investor Advocacy Clinic is on the Move

On the move

The Georgia State University College of Law is moving to its new home this weekend.  The Investor Advocacy Clinic is packed up and ready for our new space.  Until we’re up and settled, please contact us via telephone or email.  While we’re busy unpacking we’ll be regularly checking our phone and email accounts.

Check back in the coming days for photos of the new space and for updates on when you can visit us in person at our new home, 85 Park Place.

SEC Files Complaint Against Alleged Ponzi-Scheme Fraudster

By: Jason Robinson, Summer 2015 Graduate Research Assistant

The SEC recently filed a complaint concerning a Miami-based Ponzi scheme.  In 2007, Phil Williamson allegedly began to recruit investors for an investment fund called the Sterling Fund. Mr. Williamson allegedly told potential investors that there was no risk involved and that the investment would return 8-12% annually. Many of the investors in the Sterling Fund were public sector retirees who had limited experience with investing. A former police chief, two prison corrections officers and a school principal were some of the victims of Mr. Williamson’s alleged Ponzi scheme. Continue reading

Investor Advocacy Clinic Comments on FINRA Proposed Rule Change 2015-009

By: Jason Robinson, Summer 2015 Graduate Research Assistant

On April 23, 2015 the Financial Industry Regulatory Authority (FINRA) filed a proposed rule change with the Securities and Exchange Commission (SEC). FINRA proposed SR-FINRA-2015-009 which calls for the adoption of FINRA Rule 2272. The new rule “would govern sales or offers of sales of securities on the premises of any military installation to members of the U.S. Armed Forces or their dependents.” Specifically, Rule 2272 calls for these securities salespersons to conspicuously disclose in writing the identity of the member offering the securities and that the securities offered are not being provided on behalf of the federal government. The proposed rule would also incorporate FINRA’s suitability obligations.

The Investor Advocacy Clinic recently filed a comment on this rule proposal, expressing support for the proposed rule. Studies have shown that members of the U.S. Armed Forces are more vulnerable to broker misconduct than the population at large. Rule 2272’s enhanced disclosures would lead to greater transparency which would allow military personnel to make more informed investment decisions.

The Investor Advocacy Clinic offered two additions to proposed Rule 2272:

  • FINRA’s creation of a standardized Rule 2272 disclosure form
  • Expansion of Rule 2272 to sales off military installations

A FINRA standardized form would serve the rules purpose of making sure military customers are better informed and the Clinic sees no significant drawbacks to expanding the rule to on and off military installations. Click here to read the Clinic’s comment letter in its entirety along with other comment letters on the proposal.

Investor Alert: Automated Investment Tools

By Jason Robinson, Summer 2015 Graduate Research Assistant

Advancements in computer technology and the growth of internet access have made automated investment tools available to a wider range of investors. Some examples of automated investment tools are online calculators, portfolio selections services, asset optimization services, and investment management programs. While these tools can be beneficial to investors, according to a new FINRA and SEC Investor Alert on Automated Investment Tools, there are a number of risks and limitations that investors should understand before using them.

Here are five tips to keep in mind before using an automated investment tool: Continue reading