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Showing posts from April, 2011

A Success in Fighting Wall Street

Gretchen Morgenson is a business columnist for the New York Times. I enjoy reading her articles in the Sunday Business section for their relentless focus on the criminal activities conducted by Wall Street -- criminal in the moral sense, as they are usually legally defensible.
But that's changing: in last week's article (April 24, 2011), titledA Crack in Wall Street's Defenses, describes how two investors (who are neighbors in Aspen) successfully battled Smith Barney (a Citigroup subsidiary) and were recently awarded $54 million in a securities arbitration case, $17 million of which was for punitive damages. This was decided by the Financial Industry Regulatory Authority (or FINRA), an industry sponsored self-regulatory board that is approved by the SEC.
These investors were told that a complex arbitrage portfolio involving municipal bonds would provide above average returns between 2002 and 2007. In reality, it was providing Smith Barney guaranteed profits at investors…