In the world of finance, every decision can carry a significant impact on your investments. One such decision that has raised eyebrows involves Jennifer Basey, a financial advisor who has recently been in the news due to some alarming allegations. As a financial analyst and writer, I think it’s valuable to explore such cases – they remind us of the critical role regulators play and offer lessons on the importance of staying vigilant as an investor.
What Happened with Jennifer Basey?
The industry sat up and took notice when Jennifer Basey, (CRD# 4730054), made the unexpected choice to resign from her position at Stifel Nicolaus & Company. Allegedly, this was due to complaints that she attempted to compensate customers in cash who were unhappy with their investment decisions.
More specifically, it’s reported that Basey guaranteed the safety of certain investments and then proceeded to invest client money in preferred stocks at rates above what was considered fair without getting their okay, resulting in substantial financial setbacks for those clients. When these customers voiced their concerns, she reportedly tried to silence them with out-of-pocket payments. This admission led to her departure from the firm.
The Importance of FINRA’s Oversight
The Financial Industry Regulatory Authority, or FINRA, has had its eye on Basey before now. As an agency tasked with safeguarding the interests of investors and ensuring fairness in the U.S. financial markets, FINRA’s oversight is not to be taken lightly.
Basey’s specific breach of regulations stemmed from an accusation of forgery; she allegedly forged the initials of clients to authorize the transfer of funds without their knowledge or approval. Such actions directly contravene the requirement that customer authorization must be genuine and verified, hence why FINRA handed down a two-month suspension and fined her $5,000.
Lessons for Investors
The variety of complaints leveled against Basey is wide-ranging, including making unsound recommendations that resulted in unnecessary expenses for clients and neglecting to inform another about the possibility of their investment depreciating in value.
Given these potential pitfalls, it’s imperative that you, as an investor, conduct thorough research before entrusting your money to an advisor. As the saying goes, “Trust, but verify.” In today’s financial climate, it’s a bit of wisdom that could not be more relevant.
If you’re feeling unsettled by such cases, take comfort in knowing that there are avenues available for recourse. Those affected have the right to seek restitution through the FINRA arbitration process.
Overall, the situation with Jennifer Basey underscores the need for regulators like FINRA to ensure the preservation of honor within the financial domain. It serves as a strong reminder that you should remain well-informed and cautious when dealing with financial professionals.
A financial fact to consider: Bad financial advisors can be costly. According to a report, investors may lose significant amounts of money due to unscrupulous advisors, with some estimates reaching as high as billions of dollars annually due to advice tied to conflicts of interest.
So, when engaging a financial advisor, be sure to conduct your own due diligence. Check their credentials, references, and, importantly, their record on FINRA’s BrokerCheck. Through BrokerCheck, you can easily review an advisor’s disciplinary history, qualifications, and any past disputes—all factors that could influence your decision to entrust them with your financial future.
Being proactive and informed can make all the difference in navigating the complex waters of financial investments. After all, as Benjamin Franklin once wisely stated, “An investment in knowledge pays the best interest.” Keeping this in mind will serve you well as you look to grow and protect your wealth with the help of financial professionals.
