Stockbrokers
- Share via
We are encouraged by the SEC inquiry into the abuses by stockbrokers (“SEC Launches Inquiry Into Abuses by Stockbrokers,” July 25).
As welcome, and long overdue, as this inquiry is, it is important to point outthat:
1. The SEC cannot recover money lost by individual investors through fraud. Its scope includes criminal or civil penalties but the SEC cannot recover money for people.
2. The California Department of Corporations reports that the U.S. has more than 3,000 securities brokerages and 550,000 licensed securities brokers; 33% of these firms and 20% of all U.S. brokers work in California.
So, while the SEC inquiry of the 50 top abusive brokers and the 50 top abusive brokerage branches is welcome, it is barely able to make a dent in a problem of severe nature that has resulted in a 10-year arbitration increase of 600% in case filings (1980-90).
3. Arbitration is the only friend, and, indeed, is the best friend of “burned” investors. Securities arbitration is the only avenue abused investors can explore and firms are, thankfully, compelled to honor awards rendered.
PAUL N. YOUNG
Century City
The writer is chief operating officer of a firm that represents individual investors in arbitration proceedings.
Inside the business of entertainment
The Wide Shot brings you news, analysis and insights on everything from streaming wars to production — and what it all means for the future.
You may occasionally receive promotional content from the Los Angeles Times.
