Structured notes are financial products that combine elements of traditional debt instruments, like bonds, with derivatives (contracts whose value is derived from an underlying asset or index). In October 2024, Stifel Nicolaus was ordered to pay over 14.3 million after a FINRA panel found they misled investors about the risks of these notes, leading to losses.
The securities law firm of KlaymanToskes is continuing its investigation into Stifel, Nicolaus, & Co. and financial advisors who may have unsuitably recommended structured note investments to their customers. The law firm is currently representing a customer of Stifel, Nicolaus, & Co. (Case no. 23-02648), who is seeking to recover $1,300,000 in damages due to unsuitable and overconcentrated structured note investment recommendations.
Structured notes may have been marketed to investors as alternatives to bonds or certificates of deposit, targeting investors seeking income or principal protection. However, due to their complex nature, many investors may not have been fully informed about the risks associated with structured note financial products, including the potential for total loss of investment.
If you suffered investment losses in structured notes at Stifel, Nicolaus, & Co. or any other brokerage firm, Contact attorney Steven D. Toskes at (888) 997-9956 or by email at investigations@klaymantoskes.com to discuss your potential recovery options.
Recent FINRA arbitration lawsuits have brought to light significant issues with Stifel’s handling of structured note investments. A pivotal arbitration ruling in 2024 required Stifel to pay $14.3 million due to its lack of oversight over a broker’s high-risk structured note strategy. The broker, Chuck Roberts, implemented a strategy that resulted in major financial losses for investors, highlighting a systemic pattern of possible misconduct and misrepresentation in the recommendation and management of these complex investments.
According to the claim filed by KlaymanToskes, the customer is an unsophisticated investor that sought a conservative portfolio of low risk investments that would provide income and minimal risk to her principal. Additionally, the customer had no other source of income other than her investment accounts, and trusted Stifel Nicolaus, & Co. and her financial advisor Ken Ramos with making recommendations that were in her best interest. Stifel, Nicolaus, & Co.’s wrongful conduct included unauthorized transactions and unsuitable investment purchases in the following structured note investments:
JPMorgan Chase:
Royal Bank of Canada:
UBS:
Toronto Dominion Bank:
Morgan Stanley:
Bank of Montreal:
Goldman Sachs:
Citigroup:
Structured notes are complex investment products that combine elements of multiple asset classes, such as bonds and derivatives, often linked to the performance of stocks, indices, or commodities. While these products can offer high returns, they also carry significant risks including liquidity constraints, credit risks, and potential total loss of principal, particularly during market volatility.
Key Risks of Structured Notes:
Investors are often drawn to structured notes for their potential high returns. However, these investments come with risks that can lead to substantial losses, especially when the underlying asset underperforms or the issuer faces financial difficulties. If you invested in structured notes based on unsuitable investment advice or misrepresentations by your brokerage firm or financial advisor, you might be eligible for recovery through FINRA arbitration.
Investors who suffered investment losses in structured notes due to unsuitable recommendations by their financial advisor at Stifel, Nicolaus, & Co., or any other brokerage firm, are encouraged to contact attorney Steven D. Toskes at (888) 997-9956 or by email at investigations@klaymantoskes.com to discuss potential recovery options.
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