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NEW YORK August 26, 2016 (GLOBE NEWSWIRE) — The securities arbitration law firm of KlaymanToskes, www.klaymantoskes.com, has filed a $500,000 FINRA arbitration claim [FINRA Case No. 16-01835] on behalf of a United Parcel Service (“UPS”) (NYSE: UPS) employee for losses sustained as a result of Merrill Lynch’s unsuitable recommendation to invest in Rampart Options Management Services Program (“ROMS”). Merrill Lynch offers the ROMS program on a discretionary basis exclusively to high-net-worth clients holding stock positions exceeding $1 million through Rampart Investment Management Company (RIMCO).
According to KlaymanToskes, the investigation focuses on Merrill Lynch’s sales practices for customers who acquired UPS stock through UPS’ Employee Stock Purchase Plan or Managers Incentive Program and were advised by Merrill Lynch to protect their concentrated UPS stock position through Merrill Lynch’s ROMS program.
Securities attorney Steven D. Toskes from KlaymanToskes explains, “Merrill Lynch is required to supervise its financial advisors and the recommendations made to customers with concentrated stock positions, including brokerage accounts managed on a discretionary basis which are held to a fiduciary standard of care.” Mr. Toskes also noted that, “The ROMS covered call strategy is not a suitable investment strategy for an entire concentrated stock position. Our client accumulated low cost basis stock during the 30 years they worked for UPS and did not want to have their stock ‘called away’ and trigger a large capital gains tax.”
KlaymanToskes continues to represent UPS employees who invested in Rampart Options Management Services against Merrill Lynch for FINRA sales practice violations, including unsuitable recommendations, misrepresentations and omissions of material facts and failure to supervise. Investors who have information about the sales practices of brokerage firms and their financial advisors are encouraged to contact Lawrence L. Klayman, Esq. or Raymond Gentile, Esq. of KlaymanToskes at (888) 997-9956, or visit our website at www.klaymantoskes.com.