by Brian Mahany
Now that’s a novel idea… check the criminal record of people seeking jobs as stockbrokers. The Massachusetts Securities Division is proposing to require applicants seeking to be licensed as stockbrokers and investment advisers to consent to a criminal background check. While the idea isn’t foolproof, its a good plan.
Federal and state law already limits who can be a stockbroker and with good reason. These folks are entrusted with our hard earned savings and often have access to our bank accounts, social security numbers and other sensitive information. If bus drivers can be compelled to undergo a criminal background check, so should investment advisers.
Of course, having a clean record doesn’t mean your broker won’t steal. Look at Bernie Madoff – the biggest thief in U.S. history and he had a clean record.
Some states already require fingerprint cards for stockbrokers and investment advisor registrants although its unclear if they actually perform checks.
Before you trust any broker with your money, check them out first on FINRA’ BrokerCheck system. FINRA is short for the Financial Industry Regulatory Authority. They have a free, easy to navigate background system that shows prior complaints, regulatory problems, lawsuits and criminal history. The criminal history relies on self reporting, however, so it isn’t always foolproof. The SEC maintains a similar system for investment advisers.
If you have been ripped off by a stockbroker, contact an experienced fraud recovery attorney. The stockbroker fraud lawyers at Mahany & Ertl have helped people recover millions of dollars from financial professionals including stockbrokers, brokerage firms, insurance agents and others. In many cases, the matter can be handled on a contingent “success” fee basis meaning no legal fees unless we recover money on your behalf.
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