Investors across the globe have been alerted to a significant allegation made against Angel Ferrer, a broker and investment advisor currently associated with MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED (CRD 7691). The case, filed on 8/24/2023, is pending and involves an alleged breach of fiduciary duty, negligence, fraud, and several other serious charges.
Understanding the Allegation’s Seriousness
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The claimants in this case have alleged a considerable number of infractions, including a breach of fiduciary duty, negligence, fraud, breach of contract, third party beneficiary breach of contract, violation of Regulation BI, and negligent supervision. The case centers around an alleged failure to provide advice on a concentrated position and an alleged recommendation to use a line of credit to further concentrate their assets. The claimants are seeking damages of $56,000,000.
This case is serious for several reasons. Firstly, the allegations involve a breach of fiduciary duty, which means that the advisor may have failed to act in the best interests of the client. Secondly, the charges of negligence and fraud suggest that the advisor may have acted carelessly or dishonestly in managing the client’s assets. Lastly, the alleged violation of Regulation BI implies that the advisor may not have acted in accordance with the rules and regulations set out by the Financial Industry Regulatory Authority (FINRA).
Understanding the FINRA Rule
Regulation BI (Best Interest) is a rule established by FINRA. It requires brokers and advisors to act in the best interests of their clients, putting their clients’ needs ahead of their own. This rule is designed to protect investors from unfair, deceptive, or abusive practices and to ensure that brokers and advisors provide their clients with accurate and complete information about investment products and services.
In this case, the allegation of a violation of Regulation BI suggests that the advisor may not have acted in the best interest of the client. This could mean that the advisor made recommendations that were not suitable for the client’s financial situation or goals, or that the advisor failed to disclose important information about the investment products or services being offered.
Why This Matters for Investors
Allegations of this nature are a serious concern for investors. They highlight the potential risks associated with entrusting one’s assets to a financial advisor. If the allegations are proven to be true, they could indicate a systemic issue within the advisor’s firm, CITIGROUP GLOBAL MARKETS INC.
Furthermore, these allegations underscore the importance of investor vigilance. Investors must be proactive in understanding the actions taken by their advisors and the potential risks associated with their investments. They should also be aware of their rights and the recourse available to them in the event of advisor malpractice.
Red Flags for Financial Advisor Malpractice
Investors should be alert to potential red flags for financial advisor malpractice. These can include a lack of transparency, promises of guaranteed returns, unsolicited investment advice, and pressure to invest in specific products or services. If an investor suspects that their advisor is engaging in malpractice, they should seek professional advice immediately.
Investors who have suffered losses due to financial advisor malpractice may be able to recover their losses through FINRA Arbitration. This is a dispute resolution process that is quicker and less formal than court litigation. It is designed to provide a fair, efficient, and cost-effective method for resolving disputes between investors and brokers or advisors.
Haselkorn & Thibaut, a national investment fraud law firm with offices in Florida, New York, North Carolina, Arizona, and Texas, is currently investigating the allegations against Angel Ferrer and CITIGROUP GLOBAL MARKETS INC. With over 50 years of experience, the firm has a successful track record of financial recoveries for investors and boasts an impressive 98% success rate. They offer a “No Recovery, No Fee” policy and free consultations to clients. If you believe you have been a victim of investment fraud, contact Haselkorn & Thibaut at their toll-free consultation number, 1-800-856-3352, or visit their FINRA BrokerCheck page for more information.
