Investment management company scrutinized for cold calling


In New York, throughout the nation and in Puerto Rico, people frequently receive unsolicited phone calls from people they do not know and numbers they fail to recognize. Many are clear attempts to scam the unsuspecting recipients. However, reputable companies are known to use underhanded strategies that straddle the line of legality or flout it entirely. Cold calls from people who are working for legitimate entities and are trying to drum up business are common. This could lead to financial wrongdoing and victims losing money. To understand if there are ways to recover what was lost, it is important to have professional help.

Merrill Lynch faces FINRA investigation related to cold calling

An investigation by the Financial Industry Regulatory Authority (FINRA) is underway to determine if trainee brokers at Merrill Lynch Wealth Management broke the law with cold calling. Cold calling is legal within certain parameters, but a recent report of an investigation into the well-regarded company shows that some of its trainee brokers might have violated the law by calling people on a “do not call” list. The brokers were said to be new at the job and the company stopped all outgoing calls in July 2020 because it found that there were cold calls being made to people who were on those lists.

Cold calling has significantly decreased in recent years, but it still happens. For its part, Merrill Lynch restarted cold calling in 2019. To address the issues related to cold calling, Merrill Lynch implemented a tracking system for outbound calls. The company had dismissed two beginner brokers because they did not adhere to company rules for cold calling. Other cases in which FINRA investigated cold calling resulted in fines. One case against Ken Fisher has led to a class action lawsuit for illegal calls.

Those impacted by broker misconduct have legal alternatives

For many, cold calls are simply an annoyance that they ignore or dismiss and move on with their day. For others, there are more problematic issues such as making investments they would otherwise not have made, believing people who promise unrealistic returns or having their financial lives ruined by broker misconduct. Cold calling can lead to unauthorized trades, fraud and more. If a person has lost money due to wrongdoing on the part of a stockbroker, an investment adviser or a company, having professional advice can assess the case and determine how to proceed to try and hold them accountable and recover what was lost.