Benjamin Franklin once said, “An investment in knowledge pays the best interest.” This is Sovereign wisdom for anyone diving into the world of investing. However, the complexities of venture landscapes, heightened by fiscal jargon, can often discourage retail investors. A significant proportion of investments are made with the assistance of financial advisors, and this intermediation brings its challenges.
One such challenge revolves around the allegations against Michael Fisher (CRD: 4056114), a registered broker and investment advisor with Ameriprise Financial Services, LLC., in Melville, NY. Mr. Fisher, with almost 25 years of experience in the financial sector, had several customer complaints made against him. The most recent one being in June 2023. This complaint alleges Fisher engaged in unsuitable and unauthorized trading, leading to principal losses.
But before we delve further into that, let’s understand who Michael Fisher is.
Broker’s Background
Michael Fisher started in the securities industry in 2000 and has worked with renowned institutions such as Citigroup Global Markets Inc., Merril Lynch, Pierce, Fenner & Smith Incorporated, UBS Financial Services Inc., and Wells Fargo Advisors, LLC. Over two decades in the industry, Fisher has gained considerable experience and, understandably, a hefty clientele list. However, the richness of Fisher’s professional past is somewhat tainted by the complaints lodged against him.
Past allegations against Fisher include unauthorized trades, unsuitable investment recommendations, breach of fiduciary duty, and negligence. The damage amounts requested in these cases range from $50,000 to $1 million. Considering Fisher’s experience and the market giants he has worked with, these allegations raise red flags that hint at a lack of diligence and integrity.
Understanding the Issues
At this point, you may have one important query: What exactly does “unsuitable and unauthorized trading” entail? And why is this so serious?
In layman’s terms, “unsuitable” trading denotes when a financial advisor recommends investments that do not align with a client’s risk tolerance, investment objectives, financial situation, and other unique factors. On the other hand, “unauthorized” trading refers to any trade action executed without the prior approval or consent of the client.
According to FINRA Rule 2111 (Suitability), financial advisors are responsible for recommending suitable investments and strategies based on their clients’ unique profiles and risk tolerance. Breaching this delicate mandate can harm the trusting client’s investment portfolio, leading to substantial financial losses.
Consequences and Lessons
While disturbing, the allegations surrounding Fisher’s conduct offer valuable insights for investors. Notably, they highlight the significance of investor awareness and the implications of diligent supervision. For the innocent investor, they also present the alarming reality: every financial advisor may not act in their client’s best interests.
A study by the Public Investors Arbitration Bar Association (PIABA) found that up to 44% of advisors with a record of misconduct are still working in the finance industry five years after the incident. This frightening fact calls for a heightened sense of diligence on the investor’s part.
The unfortunate lessons learned from Michael Fisher’s tale underpin the inescapable mantra of “Investor Beware.” It emphasizes the importance of performing due diligence before hiring an advisor, staying informed about your investments, and maintaining a keen eye for any significant changes in your portfolio. After all, the journey towards building wealth should include careful strides guided by trustworthy advisors bolstered by prudent, personalized advice.
For further information about Fisher’s professional conduct, view his FINRA BrokerCheck here.
“The stock market is filled with individuals who know the price of everything but the value of nothing.” – Philip Fisher
