Author: Cody Berne

SEC Issues Wrap Fee Risk Alert

The SEC’s Division of Examinations issued a Risk Alert about wrap fee programs used by investment advisers. Wrap fee programs require advisory clients to pay a consolidated fee for investment advisory services and other expenses, such as commissions, trading fees, and administrative costs.

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Missing: 200,000 Ghost Cattle

The Commodity Futures Trading Commission accused a Washington rancher, Cody Easterday and Easterday Ranches, Inc., of defrauding beef and pork producers by billing for cattle that never existed.

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FINRA Panel Awards 93 Year Old Millions

Bloomberg reported about a wealthy 93 year old who brought constructive fraud, abuse of fiduciary duty, and other claims before FINRA against J.P. Morgan Securities, LLC and previously registered brokers and investment advisers.

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Investors Sue Robinhood Over GameStop Stock Restrictions

Popular online stock trading platform Robinhood announced on January 28, 2021, “In light of recent volatility, we are restricting transactions for certain securities to position closing only, including $AAL, $AMC, $BB, $BBBY, $CTRM, $EXPR, $GME, $KOSS, $NAKD, $NOK, $SNDL, $TR, and $TRVG. We also raised margin requirements for certain securities.”

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Margin Trading Is at Record Levels

Investors are borrowing against their portfolios at record levels, according to FINRA data about debit balances in margin accounts. As of November 2020, investors borrowed more than $722 billion against the value of their accounts.

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BlueCrest Settles SEC Trading Charges

BlueCrest Capital Management Limited, a United Kingdom-based investment adviser, agreed last week to pay $170 million to settle charges brought by the SEC in connection with BlueCrest’s trading.

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