According to an article in The Birmingham News, “[t]he Alabama Securities Commission said Tuesday that Memphis-based Morgan Keegan engaged in fraud, used unethical sales practices, failed to supervise agents, and withheld material facts from customers. The SEC has filed suit over the matter in U.S. District Court in Atlanta, saying the firm stranded investors with $1.2 billion of securities in transactions that earned it $4.3 million in fees from June 2007 through February 2008.”
Unfortunately, private investors in these securities will probably still have to file their own legal actions to get full compensation for their losses. This is the latest example of a securities dealer misleading its customers who placed their trust in them, only to betray this trust to pad the firm’s bottom line. Hopefully the courts in Atlanta and in Alabama will deal swiftly and sternly with such conduct. Our firm has represented too many people in the past who have been similarly duped by the people who they were paying to give them good, honest advice.
Lloyd Gathings
Tags: auction-rate, fraud, securities
