National investment loss lawyers KlaymanToskes is investigating Stifel Financial and Stifel, Nicolaus & Co. on behalf of investors whose cash positions were negligently placed into low-yield “sweep accounts,” despite the availability of significantly higher-yielding alternatives. Stifel Financial allegedly defaulted client cash into its Stifel Insured Bank Deposit Program and Stifel Insured Bank Deposit Program for Retirement Accounts, which paid as little as 0.01%, instead of allocating funds to more suitable options.
Stifel’s failure to act in the best interest of its clients allegedly resulted in millions of dollars in lost interest income for affected investors. KlaymanToskes is currently representing investors seeking to recover losses tied to low-interest-bearing accounts and negligent cash management by brokerage firms and their financial advisors.
If you had $1,000,000 or more placed into low-interest bearing sweep accounts, contact securities attorney Steven D. Toskes to discuss your potential recovery options at (888) 997-9956 or investigations@klaymantoskes.com for a free and confidential consultation. We do not collect attorney’s fees unless we are able to obtain a financial recovery for you.
From March 2020 through March 2023, Stifel, Nicolaus & Company allegedly swept uninvested client cash into its Stifel Insured Bank Deposit Program and Stifel Insured Bank Deposit Program for Retirement Accounts, which paid interest rates as low as 0.01%—even as market interest rates surged. According to a recent class action lawsuit, Stifel failed to act in the best interest of its clients by continuing to default investor cash into these low-yield affiliated bank accounts instead of higher-yielding options like money market funds or Treasury bills.
The lawsuit alleges that Stifel engaged in this practice to enrich itself and its banking affiliates through the spread—keeping the profits from loaning client cash at higher rates while offering clients virtually no yield. The complaint further claims that this conduct violates the Securities and Exchange Commission’s Regulation Best Interest (Reg BI), which requires broker-dealers to consider reasonably available alternatives and to avoid conflicts of interest that harm their clients.
Investors should know that class-actions may take many years to resolve, and that payouts are generally heavily undervalued. KlaymanToskes previously conducted a detailed study of securities arbitration versus class action and concluded that Financial Industry Regulatory Authority (FINRA) arbitration claims traditionally obtain an overall higher rate of recovery as opposed to participating and waiting for any recovery in a class action lawsuit.
KlaymanToskes is currently representing investors in claims related to negligent cash management practices and low-interest sweep accounts at major brokerage firms. Investors—especially retirees and high-net-worth individuals—may have suffered significant lost interest income as a result of being placed in low-yield programs like Stifel’s Insured Bank Deposit Program and Stifel Insured Bank Deposit Program for Retirement Accounts instead of higher-yielding options.
If you held in excess of $1,000,000 at Stifel Financial/Stifel Nicolaus & Co., and received below-market interest rates in sweep accounts, you are entitled to pursue a financial recovery through FINRA arbitration as opposed to participating and waiting for any recovery in a class action lawsuit. Contact securities attorney Steven D. Toskes at (888) 997-9956 or email investigations@klaymantoskes.com for a free and confidential consultation to discuss your recovery options.