Posted on 04/19/2016 4:00:30 PM PDT by Homer1
I have a brokerage account. A person with the same name as me passed away and the broker transferred all of my shares to his heirs.
What legal actions can I take? What rights do I have? Anybody in the financial industry that can weigh in...it would be appreciated.
Thanks
Tell a lawyer to tell the investment house that you are not dead and that the employee and your son are committing bank fraud.
Just joking. I hope you get it worked out
Document everything
Every call
Time, date, names and summary of calls
Instruct them as to the problem and how you want it fixed
If it does not happen and it involves lots of money, get legal counsel and have him contact them.
FILE A COMPLAINT with the NASD or SEC.
If nothing happens, file a complaint with your state attorney general.
Write a letter to your Senator and Congressman
You certainly don’t share SSNs which were used to establish the account. I suspect that brokerage has a problem, but we also live in an era of lawlessness (John Corzine), where most anything goes if it goes for the big guys.
That opens up the whole street name can of worms. But the value of the stocks at the current time certainly is.
PS:
Sounds pretty sad as how many John Smiths do major brokerage firms have?
I would think there are a few safe guards to prevent this like an account number for starters.
After you get it squared away you may consider changing firms!
I can't imagine how much money insurance companies are sitting on because nobody even knows they exist.
Safeguards indeed. I recently acted as the personal representative for a deceased person. ALL of the firms I dealt with looked to have pretty rigorous controls to prevent something like that happening. In all cases,I had to provide a death certificate (which does contain the deceased’s Social Security Number) along with letters testamentary, account numbers, estate ID numbers... all kinds of stuff to get accounts and funds transferred. Unless the dead guy’s SSN is the same as Homer’s, it is really hard to see how that happened.
Yeah, and after it is made right.... Get a new broker.. a big firm with good internal controls processes!
The use of the word “attorney” is probably incorrect and irrelevant. Unless the account is decades old, it contains an arbitration agreement, as does every single brokerage agreement I’ve ever seen/signed and I have had seven brokerage accounts. Each and every one has an arb clause. That means, you have pre-agreed to settle the “dispute” via arbitration and you waive the right to a trial or any sort of litigation outside of arbitration.
But you do not want to get anywhere near arbitration and there should be no need to do so. It’s costly, minimum $2500 to start the game, and the arb caluse will specify that your arb has to take place in NYC or someplace else that is likely most inconvenient for you.
I’d be absolutely stunned if the brokerage did not work this out for you. It may take a few days. You want to get conversant with what is known as a “compliance officer”. You will show him a statement showing your shares pre-distribution. If you have a local branch of the brokerage, this should be pretty easy. Otherwise you can scan and email the docs. You will ask him/her to look at your account now today and see items removed from the account. Be prepared to name those items unless it is really obvious. And then you ask “show me the confirmation of sale or option exercise put the shares back in my account”.
Had you sold options that caused your shares to be assigned or called out....I am going to ignore that possibility....but even so, your acct history would show that.
Take a deep breath, you’ll have this fixed in a couple of days.
let your fingers do the walking ....
http://whitecoatinvestor.com/what-to-do-when-your-broker-rips-you-off/
http://www.jeffreyfeldman.com/Practice-Areas/Broker-Misconduct/Trading-on-Margin.shtml
While this obviously is a big deal to Homer1, behind the scenes, it's not a big deal. It'll be fixed, no problems.
no problems
Big problem it never should have happened,change firms?
LAWYER....
A good one, that specializes in finance.
Licensed brokers should have/will have Errors and Omissions insurance.
You likely cannot sue - I’ve never seen a brokerage agreement that doesn’t have an arbitration clause. So you will be playing against a stacked deck. If you do invoke arbitration, you need a lawyer who knows what he is doing with an arbitration case - there’s as much work preparing for an arbitration as for a major lawsuit, and the broker’s lawyers are going to know every rule and trick (and go for an arbitrator that wants their repeat business).
You do want to mention that you are willing to get their regulators involved (FINRA or the SEC).
But if they can’t get it straightened out by Monday, you need to find a lawyer 1)licensed in your state, 2)familiar with securities law and 3) knows their way around an arbitration. This won’t be cheap.
I would tell the broker that his Brokers License is on the line with this mistake and his firms local license .
I would visit the local office in person and request a meeting with The Manager of the office immediately .
This is very reckless situation with Tax ramifications and SEC would take note if not corrected .
There is a chance that the broker will fix things, and certainly prudence would indicate that a person should make an initial effort to get things fixed without an expensive lawyer, but based upon my experience with brokers, one shouldn’t be optimistic.
An in-person visit might be a good idea, but don’t go alone. You need a second witness to what goes on in the office.
No need for a lawyer yet. Tomorrow morning, call your brokers manager, explain the situation and demand he get back to you by the end of the day with an explanation and an action plan/timeframe for resolution. If you have stocks, ask the manager to check the ex dividend dates as you don’t want any dividends disappearing.
Relax. Brokerage firms employ humans. Sometimes mistakes are made. The SEC will assure that things a put right. 25 years as a stockbroker.
Write a letter, fax it, mail it certified to the broker dealers office of supervisor y jurisdiction.
Tell your broker by fax or letter or email whatever it takes to get the shared back. In the meantime submit a ACAT to transfer all securities to the new broker unless you want to pay for certificates to be issued.
Tell FINRA if you think it’s more than some doofus in the back office being a doofus.
Your securities are safeguard up to 500k in securities and cash, but only 100k in cash for broker fraud. Furthermore since they are held in streetname they will be returned no problem.
If they give you a problem write FINRA
Don’t contact the NASD, they are closed. Re-branding as FINRA
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