Gretchen Morgenson
speaker
80 appearances
2 recordings
1 series
first heard Feb 2019
last heard May 2019
Gretchen Morgenson’s voice in public audio — every appearance, attributed to the second.
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Appearances
WSJ Your Money Briefing · Should a Financial Adviser Inherit a Client's Assets? · 23 May 2019
podcast
Well, what happened was we had a situation in Maryland where a broker was a beneficiary in an elderly client's will.
Even though his firm had rules against bequests saying that you had to tell your superiors that you had received a bequest, you were going to receive a bequest, he did not do so.
And he received a quarter of the assets in the client's account.
Which was $500,000.
Oh, my.
So this was an interesting situation.
I think a lot of people were shocked by it.
I received a lot of emails from readers saying I had no idea that this was even allowed.
Well, I had never heard of it before.
You obviously have the potential for conflicts of interest when a financial advisor is a beneficiary to a client's account.
And so you would think that there would be rules and regulations against this.
But in this particular case, the regulatory authority that oversees this broker and most brokers in the United States, the FINRA, it's called, the Financial Industry Regulatory Authority,
did not bring action against the broker, did not bring action against the firm, even though he did receive this bequest.
So I think what the lawmakers are saying is this is a loophole.
This is something that needs to be changed, and it needs to be changed now.
Well, that's a question, actually.
She did make the bequest.
However, doctors, or her doctor, said that she was probably not understanding what she was signing when she transferred her accounts into an account that would pay the beneficiaries directly.
And so what you have here as a question is, was she in her full faculties?
She had actually been diagnosed with vascular dementia, and she died just a few months after switching these accounts and signing that documentation.
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