Over the last year, I have filed cases on behalf of several elderly people, some of whom have serious cognitive issues. All have been abused by a trusted financial advisor. In the first case, a son discovered that his father, who had Alzheimer’s, was buying and selling one third to one half of his municipal bond portfolio every month. The son knew his dad wasn’t making these orders. He was no longer aware of his investments. It was clear to the son that the broker was churning municipal bonds for the commissions. I filed a FINRA arbitration for the family. It recently settled. The brokerage firm that wrongly churned this elderly couple’s municipal bond portfolio compensated them.
In the second case, a daughter discovered that a stockbroker from a large brokerage firm had gone to her father’s room in an Alzheimer’s unit, taken her father to a discount store, and purchased a computer. The broker installed it in her father’s room. He also set up an e-mail account with a password for her father. The broker e-mailed prospectuses to her father. He was selling him new issues. These were not suitable investments. They were high commission, speculative stocks—certainly not what should have been in the account of an elderly man whose family was paying for his care. The man lost a lot of money and his daughter hired me to file a FINRA arbitration against the broker and the firm. The case settled for a significant amount of money. The state securities commission is now considering whether the broker’s license should be terminated.
The third case was for an older widow. Her stockbrokers attended her husband’s funeral and, the next day, recommended that she sell the municipal bonds her husband had carefully purchased to provide income for his wife and disabled adult son. They sold the widow an annuity. A year later, they returned to her home for an “annual checkup” and recommended she switch annuities. She trusted them and she simply agreed with their recommendations. It was only when she was contacted by the insurance company issuing the new “replacement” annuity that she sought my assistance. Again, I filed a FINRA arbitration for fraud and elder abuse against the brokers and the brokerage firm they represented. The case recently settled, and the widow was made whole.
Elderly widows are particularly vulnerable. Unless their adult children, nieces or nephews are watching their investment accounts, there are brokers who will simply manage them in order to maximize commissions—regardless of the risk level or return. And, unfortunately, because many brokers work for themselves or are poorly supervised, no one stops this chicanery. The law provides extra relief for victims of elder abuse. In addition to recovering losses, and interest, attorneys’ fees and punitive damages can be recovered.
If you or your loved one has been the victim of unsuitable financial recommendations please contact Diane Nygaard at (913) 485-5014 for a free consultation.Contact Us