News And Thoughts On The Law In And Around New Orleans

Bipartisan Bill Introduced to Empower SEC to Seek Restitution

On March 14, 2019, Senators Mark R. Warner, a Democrat from Virginia and John Kennedy, a Repuplican from Louisiana, introduced the Securities Fraud Enforcement and Investor Compensation Act, a bipartisan bill that would empower the U.S. Securities and Exchange Commission ("SEC") to seek restitution for investors harmed by securities fraud. Many investors do not realize that under current law, the SEC often does not have the ability to make investors whole, because it is only authorized to seek disgorgement of profits from wrongdoers, not restitution of the full amount of damages that they inflict upon investors.

VIX Index Investment Products Unsuitable for Most Investors

Investments in VIX Index-linked investment products raise suitability concerns for retirees and other retail investors.  The Financial Industry Regulatory Authority (FINRA) has recently issued a regulatory notice warning member firms that VIX-Index linked products "are highly likely to lose value over time."  FINRA further warned firms that such products may not be suitable for retail investors, "particularly those who plan to use them as traditional buy-and-hold investments."


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