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About:
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Investment advisers across the country are facing increasingly difficult challenges in fulfilling their important regulatory responsibilities. Recently, in January, a United States federal district court found that an investor's right to take her case to arbitration was denied by an Illinois member bank. In a strongly worded decision, the court stated that, by limiting arbitration to non-forfeiture cases, the bank violated both federal and state law. The court also held that the limitation deprived the client of the right to seek damages for violations of fiduciary responsibilities. According to the judge in this case, the regulatory body, the Board of Trustees of the bank, failed to properly explain to its clients the extent of the fiduciary duty they owed to the clients in the transaction leading up to the loss.
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