Securities Lawyers Blog
The attorneys at Gana Weinstein LLP are investigating BrokerCheck records reports that financial advisor Heather Weber (Weber), currently employed by Merrill Lynch, Pierce, Fenner & Smith Incorporated (Merrill Lynch) has been subject to at least ten customer complaints during the course of her career. According to records kept by The Financial Industry Regulatory Authority (FINRA), Weber’s customer complaints alleges that Weber recommended unsuitable investments in options among other allegations of misconduct relating to the handling of their accounts.
In September 2019 a customer complained that Weber violated the securities laws by alleging that Weber engaged in sales practice violations related to unsuitable investment recommendations and misrepresentations concerning options. The claim alleges $350,000 in damages and is currently pending.
In May 2017 a customer complained that Weber violated the securities laws by alleging that Weber engaged in sales practice violations related to unsuitable investment recommendations and misrepresentation from February 2012 to June 2014. The claim alleged $1,000,000 in damages and settled for $92,500.
There are different risky strategies that can employ options trading. One such strategy is the use of the iron condor, which involves the purchase of multiple uncovered options versus safer covered options. When an option is covered the investor holds an offsetting stock position in the asset underlying the option. The stock position can help offset the risk of the short position of the option. However, with an uncovered option the investor has unmitigated risk. If the underlying stock substantially drops or increases in value for an uncovered position the investor have only two options. Either the investor has to let the options expire and lose the entire investment or buy the stock at a disadvantageous price.