Securities Lawyers Blog
The attorneys at Gana Weinstein LLP have filed a complaint on behalf of investors relating to financial advisor Jason Mitsuda’s (Mitsuda) sales of structured products. At the time Mitsuda was registered with Equitable Advisors, LLC (Equitable) and has since been registered with Ameriprise Financial Services, LLC, Cetera Investment Services, LLC, and now Pruco Securities, LLC.
Structured products are a class of derivative products that derive their performance from market linked data. A structured product generally references a source against which market risk is taken. The source can be a single security, a basket of securities such as a market index, commodities, interest rates, or a real estate loan portfolio. The variety of products that can be structured demonstrates the difficulty in formulating a single unified definition of a structured product.
In recent years, banks of started issuing structured products that reference not a basket of securities or a broad index but instead a single stock. And usually not just any stock but instead a very volatile stock that exhibits large price fluctuations. The structured product at issue in the case filed by our firm referenced a well known high risk technology ETF called ARK Innovation ETF “ARKK.” The ARRK investment was issued by JP Morgan and came due at the end of 2022. Banks issue these structured products trying to entice investors with promises of above market interest rate returns. However, the banks know that the volatile stocks that the notes are linked to make it likely that the bank will be protected from paying the investor.