Posted August 20, 2024
Our law firm has been filing class action claims for compensation against a number of stock brokerage firms on behalf of investors, arising out of the firms’ use of the cash in those investors’ accounts. We believe those firms improperly used the cash in their customer accounts to generate substantial profits, and kept most of those profits to themselves.
We are preparing to file additional class action claims for compensation against other stock brokerage firms that used their customers’ cash to generate profits for themselves, at the expense of those customers.
This issue is widespread in the securities industry, and regulators have started investigating.
Request a free case evaluation of your potential claims for compensation arising out of your stock brokerage firm’s potentially improper use of cash holdings in your brokerage account, via email at arosca@rscounsel.law, through the contact form on this page, or by calling 888-998-0530.
Contact Us Today
Free Case Evaluation
Posted August 20, 2024
The investor rights attorneys at Rosca Scarlato LLC law firm have been filing class action claims to seek compensation for investors in a number of securities broker dealer firms that allegedly misused the cash in their customer accounts to generate substantial profits and keep most of those profits to themselves.
Investors who own brokerage accounts and would like to learn more about their potential claims for compensation may contact investor rights attorneys Alan Rosca, or Paul Scarlato. Claims that are not timely pursued may expire or otherwise be lost, generally speaking.
Attorneys Rosca and Scarlato have extensive experience in seeking compensation related to investor harm against financial industry members.
They typically work on a contingent fee basis, do not require any money down from their clients, advance case expenses, and only get paid for their fees and expenses if and when successful.
Brokerage firm customers may contact attorneys Alan Rosca or Paul Scarlato to discuss their potential options toll free at 888-998-0530, via email at arosca@rscounsel.law, or through the contact form on this webpage.
Improper Cash Sweep Practices: Certain brokerage accounts are automatically placed by brokerage firms into cash sweep programs with pre-selected banks, including banks that are affiliated with some of those firms. However, the majority of the returns on those investors’ money are not paid to those investors. Instead, the stockbrokerage firms retain the majority of that money, often while charging additional advisory fees.
Improper Fees in Money Market Funds: The Rosca Scarlato investor lawyers have identified brokerage firms that place cash in certain customer accounts into money market funds that charge investors significantly higher fees and pass a portion of those fees back to the brokerage firm. Such fees, often misrepresented to customers, can significantly diminish the investors’ returns.
Recently, the Securities and Exchange Commission (SEC) reportedly commenced investigations into some brokerage firms’ cash sweep programs, according to media reports .
In recent past, Charles Schwab reportedly agreed to pay $187 million for alleged failure to disclose the impact of its cash sweep program on customer returns. Other firms that were investigated include AssetMark Inc., Huntleigh Advisors, Inc., and First Republic Bank, according to media reports.
Investor rights attorneys Alan Rosca and Paul Scarlato at Rosca Scarlato have reviewed a substantial volume of records and other evidence related to multiple firms’ cash sweep programs, and are available to talk to investors who are concerned about the potentially improper use of the cash in their accounts, by their brokerage firms. They have decades of combined experience representing victims of fraud or other financial misconduct.
If you are concerned about potential misuse of the cash in your brokerage account, you may contact attorneys Alan Rosca or Paul Scarlato to learn more about your rights and for an evaluation of your potential claims, or to provide useful information. All consultations are free.
The Rosca Scarlato attorneys typically take cases like this on a contingency fee basis, advance all case costs, and only get paid for their fees and expenses if and when they are successful.
To reach attorney Alan Rosca or his colleagues, call 888-998-0530, email arosca@rscounsel.law, or leave a message by using a contact form on this webpage.
The general considerations on this page are for informational purposes only and do not constitute legal advice. Such legal advice can only be offered once the attorneys discuss each investor’s situation, learn of the relevant facts, and can tailor any advice to that investor’s facts.
Contact info:
Rosca Scarlato LLC – 216-946-7070 / 888-998-0530.
Alan Rosca – arosca@rscounsel.law
Paul Scarlato – pscarlato@rscounsel.law
Wells Fargo, Merrill settle SEC ‘sweeps’ probe for $60M (by Financial Planning, January 17, 2025)
In the Matter of Wells Fargo Clearing Services, LLC and Wells Fargo Advisors Financial Network, LLC, SEC Order Instituting Administrative Cease-and-Desist Proceedings (File No. 3-22430)
In the Matter of Merrill Lynch, Pierce, Fenner & Smith Incorporated, SEC Order Instituting Administrative Cease-and-Desist Proceedings (File No. 3-22433)
Wall Street Giants Sued In Rising Furor Over Low Cash Sweep Rates (by FA Magazine, September 11, 2024)
Suit: Charles Schwab used ‘cash sweeps’ for $22B TD Ameritrade acquisition (by Financial Planning, August 30, 2024)
Three New Cash Sweep Suits Target Schwab, RayJay (by Ignitges, August 29, 2024)
Raymond James, JPMorgan, UBS Targeted As Plaintiff Lawyers Lob More Cash Sweep Suits (by AdvisorHub, August 28, 2024)
JPMorgan Chase is sued over low rates on cash sweeps (by Reuters, August 26, 2024)
In the Matter of Cadaret, Grant & Co., Inc, SEC Order Instituting Administrative and Cease-and-Desist Proceedings (File No. 3-21990, August 12, 2024)
SEC investigating Wall Street banks over ‘billions’ in lost interest payments (by Financial Times, August 6, 2024)
Bank of America Flags Potential Regulatory Review of Cash Sweep Yields (by AdvisorHub, August 6, 2024)
Morgan Stanley says SEC seeking details on advisory account cash balances (by Reuters, August 5, 2024)
Wells Fargo Targeted as Cash Sweep Lawsuits Snowball (by AdvisorHub, August 1, 2024)
Wells Fargo sued twice over cash sweep rates, LPL sued again (by InvestmentNews, August 1, 2024)
Investors Lob Another Cash Sweep Suit, This Time at Ameriprise (by AdvisorHub, July 29, 2024)
LPL Targeted in Latest Suit Over ‘Paltry’ Rates on Cash Sweeps (by AdvisorHub, July 18, 2024)
Morgan Stanley Faces Lawsuit Over Cash Sweep Rates (by AdvisorHub, June 20, 2024)
Wells Fargo’s cash sweep feature faces SEC investigation (by Reuters, November 1, 2023)
In the Matter of AssetMark, Inc., SEC Order Instituting Administrative and Cease-and-Desist Proceedings (File No. 3-21724, September 26, 2023)
In the Matter of Huntleigh Advisors, Inc. and Datatex Investment Services, Inc., SEC Order Instituting Administrative and Cease-and-Desist Proceedings (File No. 3-21313, February 27, 2023)
In the Matter of Charles Schwab & Co., Inc. et al, SEC Order Instituting Administrative and Cease-and-Desist Proceedings (File No. 3-20897, July 13, 2022)
In the Matter of First Republic Investment Management, Inc., SEC Order Instituting Administrative and Cease-and-Desist Proceedings (File No. 3-20865, May 19, 2022)
In our legal system, every person is innocent until and unless found guilty by a court of law or a tribunal. Whenever we reference “allegations” or charges that are “alleged,” such allegations or charges have not been proven, and are merely accusations, not findings of fault, as of the date of the blog. We do not have, nor do we undertake, a duty to continue to monitor or follow matters about which we report, and/or to publish subsequent updates regarding various developments that may occur in such matters. Readers are encouraged to conduct their own research regarding any such matters and any developments that may or may not have occurred in such matters. Also, the Brokercheck report linked to some of our blogs is the up-to-date version as of the date of accessing by the reader. The information in our blogs is current as of the date of the drafting of the blog, and given that sometimes certain past complaints may no longer be listed in newer Brokercheck reports, some of the events referenced in some of our blogs may later on be removed from newer Brokercheck reports. Visitors may check the most recent version of each brokercheck report at www.finra.org, and may contact FINRA for the earlier version of the Brokercheck report upon which various blogs may be based.