SEC Examiners Cracking Down On Unsuitable Sales Practices And Annuities While FINRA Tackles "Risk-Free" Structured Products

Monday, June 27, 2011 22:24
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SEC Examiners Cracking Down On Unsuitable Sales Practices And Annuities While FINRA Tackles

Tags: suitability

The regulators are redoubling their efforts to fight the known problem areas of the last few years: the structured products that brought down several broker-dealers, annuities, and abusive sales practices in general.

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The SEC is going after annuity sales and, more broadly, issues of suitability and advisor supervision.

 

FINRA has a bone to pick with structured products -- especially when they're sold as "principal protected" vehicles to retail investors desperate for a way to avoid market risk.

 

Since we see problems with all of these sales practices again and again, it's good that the regulators are getting proactive here.

 

The question is what the next generation of lethal products out there on the horizon waiting to wreak havoc on the industry looks like.

 

It would be nice before the regulators were able to step up and beat the next round of scandals before they get out of hand, in addition to concentrating on the practices that have already killed brokerage firms, wrecked careers, and derailed investors' financial lives.

 

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