|
Never make a check out to a sales representative.
Never send checks to an address different from the business address of the brokerage firm or a designated address listed in the prospectus.
If your sales representative asks you to do any of these things, contact the branch manager or compliance officer of the brokerage firm.
Never allow your transaction confirmations and account statements to be delivered or mailed to your sales representative as a substitute for receiving them yourself. These documents are your official record of the date, time, amount, and price of each security purchased or sold. Verify that the information in these statements is correct.
Certain activities may indicate problems in the handling of your account and, possibly, violations of state and federal securities laws.
Be alert for:
- Recommendations from a sales representative based on "inside" or "confidential information," an "upcoming favorable research report," a "prospective merger or acquisition," or the announcement of a "dynamic new product."
- Representations of spectacular profit, such as, "Your money will double in six months." Remember, if it sounds too good to be true, it probably is!
- "Guarantees" that you will not lose money on a particular securities transaction, or agreements by a sales representative to share in any losses in your account.
- An excessive number of transactions in your account. Such activity generates additional commissions for your sales representative, but may provide no better investment opportunities for you.
|