Shepherd Smith Edwards & Kantas LLP Investigate H&R Block Financial Advisors

The Financial Industry Regulatory Authority (FINRA) recently announced an enforcement action over sales of reverse convertible notes. H&R Block Financial Advisors, Inc., (Ameriprise Advisor Services, Inc.) were fined $200,000 as a result. According to FINRA, H&R Block Financial Advisors failed to establish adequate supervisory systems and procedures relating to the sales of RCNs to consumers.

Apparently H&R Block did not respond to indications of potential over-concentration in RCNs in customer accounts. H&R Block broker Andrew MacGill was fined and suspended.

One elderly couple incurred losses because of H&R Block’s failures and FINRA ordered $75,000 be paid to them in restitution.

Houston-based securities law firm Shepherd Smith Edwards & Kantas LLP say they are now investigating claims on behalf of investors who purchased reverse convertible notes.

At the same time, in an effort,

FINRA has released an Investor Alert to educate consumers about how reverse convertible notes work. The alert, Reverse Convertibles – Complex Investment Vehicles, explains these instruments often have two components:

  • a debt instrument (usually a note and often called the “wrapper”) that pays an above-market coupon (on a monthly or quarterly basis); and
  • a derivative, in the form of a put option, that gives the issuer the right to repay principal to the investor in the form of a set amount of the underlying asset, rather than cash, if the price of the underlying asset dips below a predetermined price (often referred to as the “knock-in” level).

Shepherd Smith Edwards & Kantas LLP Investigate H&R Block Financial Advisors 1

FINRA Regulatory Notice 10-09 reminds firms about their sales practice obligations when recommending or selling these complex instruments to retail investors.

Attorneys at Shepherd Smith Edwards & Kantas LLP represent investors nationwide to recover losses, representing clients in Federal and state courts and in arbitration through the Financial Industry Regulatory Authority (FINRA), the New York Stock Exchange Inc. (NYSE), the American Arbitration Association (AAA) and in private arbitration actions.

Shepherd Smith Edwards & Kantas LLP says over the past 18 years, they have represented more than 1,000 investors, recoverinh more than $100 million for their clients.

Alan Gray is the Publisher and Editor-in-Chief of NewsBlaze Daily News and other online newspapers. He prefers to edit, rather than write, but sometimes an issue rears it’s head and makes him start hammering away on the keyboard.

Content Expertise

Alan has been on the internet since it first started. He loves to use his expertise in content and digital marketing to help businesses grow, through managed content services. After living in the United States for 15 years, he is now in South Australia. To learn more about how Alan can help you with content marketing and managed content services, contact him by email.

Technical Expertise

Alan is also a techie. His father was a British soldier in the 4th Indian Division in WWII, with Sikhs and Gurkhas. He was a sergeant in signals and after that, he was a printer who typeset magazines and books on his linotype machine. Those skills were passed on to Alan and his brothers, who all worked for Telecom Australia, on more advanced signals (communications). After studying electronics, communications, and computing at college, and building and repairing all kinds of electronics, Alan switched to programming and team building and management.

He has a fascination with shooting video footage and video editing, so watch out if he points his Canon 7d in your direction.