When an investor is defrauded in some way, or another securities violation occurs, the investor, colleagues of the fraudster, the company employing the fraudster, and even the public are at risk of substantial financial losses.
One of the most common ways this is done is through parking and steering schemes. In these types of schemes, the investor loses money while the investment advisor or investment planning corporation gains.
Continue reading to learn more about how parking and steering schemes occur, why they are an issue in the first place, and what you should do if you become aware of an ongoing parking and steering scheme.
Parking schemes occur when an investment planner or stockbroker arranges trades that will increase returns for one account but result in a loss to other accounts. Steering schemes occur when an investor is steered toward certain investments that will unnecessarily increase the fees the investor pays, thus increasing the fees earned by the advisor and institution.
In either of these types of schemes, the financial advisor and their investment firm stands to gain due to the loss of the investor. Not only is this an unscrupulous business practice, but it’s a securities violation that the U.S. Securities and Exchange Commission (SEC) takes very seriously.
Fortunately, just like with the majority of securities fraud, parking and steering schemes typically leave quite the paper trail. As such, if you happen to overhear information regarding either of these types of fraud, stumble upon financial records or other confidential documents, or have another reason to believe that someone is engaging in a parking and steering scheme, you can report your tip to the SEC.
Before you do, you’ll want to retain a highly trained SEC whistleblower lawyer who can help you protect you from retaliation and assist you in remaining anonymous. Your attorney will work to ensure that you meet the whistleblower award criteria so you can be properly rewarded for your efforts.
These criteria include coming forward voluntarily, providing original information, and providing information that results in recovered sanctions that exceed $1 million. Depending on how valuable your tip was to the success of the SEC’s investigation, you could be entitled to an award of up to 30 percent of the total recovered sanctions.
Understanding parking and steering schemes can be difficult, but if you believe you have pertinent information regarding such a scheme and you want to take action by blowing the whistle, an experienced SEC whistleblower lawyer at Meissner Associates can help.
We’ll protect your identity and assist you through the whistleblowing process so you can be awarded the compensation you’ve rightly earned. If you are ready to become an award-winning whistleblower, schedule your confidential tip evaluation today by calling our firm at 1-866-764-3100 or submitting the secured contact form we have provided at the bottom of this page.