Securities America

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Mar 22, 2011 4:28 pm

What do you think of the Securities America fiasco and the amount of legal liabilities the firm might face as a result of selling MedCap and Provident private placements? A judge recently shot down the firm's request to bundle several class actions and arbitrations into one settlement. Now, the firm will likely face several individual claims, and its financial situation is up in the air. Do you think Ameriprise will step up to help?

How are you SAI advisors responding? Is anyone planning an exit strategy? What has SAI communicated to you about their situation?

Feel free to contact me at 212-204-4363 if you'd like to discuss your insights.

Thanks, Diana Britton

Mar 22, 2011 4:01 pm

Score one for the lawyers and the nanny state. The average SIA advisor produces about $275k, endeavoring to serve private investors with more "sophisticated", but not guaranteed, products.

It seems the mother company would serve investors better by focusing on the core business.

The CFO of SIA has already stated this action could be the end.

Once again, American capitalism is sold out to lawyers, regulators, feel-good nanny state actions - leaving the real business to be conducted by bigger business and growing government.

Watch out, small RIAs, after smaller b/ds, you are next in front of the vacuum cleaner.