Zamansky LLC announces that it is investigating sales of hedge funds by former Merrill Lynch financial advisors, James Goetz and Stephen Brown. On September 19, 2014, Reuters reported that Merrill Lynch fired these two veteran brokers from its Private Banking and Investment Group two weeks ago for “selling away” or guiding clients to invest in hedge funds outside of the brokerage firm. The two advisors, known as “The Brown Group,” were based in Pittsford, New York, a suburb of Rochester, and managed about $2.5 billion of assets for clients, according to Reuters.
According to securities attorney Jacob Zamansky, “selling away” is a violation of brokerage firm policy and the rules of the Financial Industry Regulatory Authority Inc. (“FINRA”) which regulates brokerage firms. “Selling away” is major concern, Zamansky states, because a broker avoids supervision and compliance scrutiny.
Hedge funds and alternative investments are risky products for investors, Zamansky states. There are strict income and net worth qualifications for hedge funds, the hedge funds may engage in derivative or other exotic trading strategies, there can be a lack of transparency and limited risks to exit, Zamansky says. Therefore, proper supervision and oversight which serve as important investor protections are even more significant for sales of hedge funds, Zamansky says. Any investor who believes that their financial advisor is selling away or engaging in any transactions outside the brokerage firm should have the situation reviewed by a professional to make sure that nothing inappropriate has occurred, Zamansky says.
What Investors Can Do
If you were a brokerage customer of these Merrill Lynch financial advisors and invested in a hedge fund, please contact our firm for a review and evaluation of your rights. You can contact Jake Zamansky by telephone at (212) 742-1414 or by email at firstname.lastname@example.org.
About Zamansky LLC
Zamansky LLC is a leading law firm specializing in securities fraud, hedge fund and investor class action litigation. We are investment fraud attorneys who represent both individual and institutional investors. Our practice is nationally recognized for our ability to aggressively prosecute cases and recover investment losses.
To learn more about Zamansky LLC, please visit our website, http://www.zamansky.com.
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Jake Zamansky, 212-742-1414