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Zamansky LLC is investigating an options-based investment strategy utilized by various brokerage firms — including Morgan Stanley and Merrill Lynch — sometimes referred to as the Collateral Yield Enhancement Strategy, or “CYES”. The CYES is a complicated and risky options strategy, managed by Harvest Volatility Management, LLC. The CYES utilizes “iron condor” options trades and …
Similar to all other consumer industries, there are fads in the retail investment market. One recent fad promoted by big Wall Street banks like UBS and Credit Suisse is the “yield enhancement strategy,” also known by the acronym, “YES.” Despite its catchy name, and despite being pitched as a low-risk alternative to traditional investing, the …
There is no question that yield enhancement strategies (YES) present substantial risks for individual investors. There is also no question that most individual investors lack the in-depth knowledge of options, margin, puts, calls and other relevant investment concepts needed to make informed decisions about investing with yield enhancement strategies. But, this has not stopped Wall …
IBM employees appealed dismissal of claims that fiduciaries of IBM’s employee stock option plan violated their duty under ERISA to manage plan assets prudently because they knew, but did not disclose, that IBM’s microelectronics division was overvalued. District court found a prudent fiduciary could have concluded an earlier corrective disclosure would have done more harm than good. …
The participant-plaintiffs in a stock drop case have won a rare victory in federal court. The plaintiffs alleged that the IBM defendants (IBM itself, along with the Retirement Plans Committee of IBM; Richard Carroll, IBM’s Chief Accounting Officer; Martin Schroeter, IBM’s CFO; and Richard Weber, IBM’s general counsel) failed to prudently and loyally manage the …
A federal appeals court in New York ruled against International Business Machines Crop., overturning a lower court dismissal of a lawsuit by IBM 401(k) plan participants, who alleged plan managers violated their fiduciary duties. The three-judge appellate court panel reversed and remanded a September 2017 dismissal by a District Court judge regarding a company stock …
On December 18, 2018, media reports revealed that Massachusetts’ securities regulators are investigating GPB Capital Holdings, which sold approximately $1.8 million of its private funds. The funds were sold through independent brokerage firms that reportedly received 10% commissions for pushing these funds on investors. These investments, however, were highly speculative and risky private placements that …
A Jacksonville judge may soon decide if CSX shareholders have the right to take the Jacksonville railroad giant’s board of directors to task for its decision to spend $84 million to hire former CEO Hunter Harrison even though he was in poor health and would die eight months later. Three shareholders filed suit this year …
Win or lose, the distressed workers challenging IBM’s handling of its overinflated stock-filled retirement plan have opened a door for others pursuing similar fraud cases. The U.S. Court of Appeals for the Second Circuit’s recent decision to resuscitate the years-old case of Jander v. Retirement Plans Committee of IBM is a rare victory in a …
A Second Circuit panel on Monday gave a proposed class of IBM employees another shot at proving the company improperly invested workers’ retirement savings in overpriced IBM stock, saying a New York federal judge shouldn’t have tossed claims that the alleged actions flouted the Employee Retirement Income Security Act. The workers provided adequate support for …
Mr. Zamansky's securities law blog is closely read and monitored by regulators and influential financial reporters and has prompted several major news and feature stories.
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