IAC Professor Nicole Iannarone filed a comment in response to FINRA Regulatory Notice 17-34, seeking information non-attorney representatives (NARs) representing investors in FINRA proceedings, earlier this week. In her comment, available here, Professor Iannarone described the difficulties regular investors face in finding legal assistance in FINRA proceedings and recommended funding to sustain and grow the investor advocacy clinic program to ensure investors have high quality representation in FINRA claims by licensed attorneys. Professor Iannarone further discussed protections that could be put into place to ensure all investors have access to justice even if their only option for representation is through NARs.
By: Julio Perez, Fall 2017 IAC Graduate Research Assistant
By now, we can piece enough clues together to more-or-less understand what a capital gain is; namely, a gain to an investor’s initial capital. Indeed, capital gain is defined as the profit that comes when an investment is sold for more than the price the investor paid. In order words, if you buy a share of stock for $2.00 and sell it for $2.01, you just made a capital gain.
So great, I hope you enjoyed this post of “Translate This!”. No, of course that’s not all there needs to be said. Perhaps the second most important concern to an investor after making a profit from their investments is how to lose as little of that profit to taxes as possible. Your capital gains (and capital losses, if you sold your stock at a loss) are usually reported while filing your income tax, which means that the IRS, and not the SEC, is in charge of regulating this part of the process. Continue reading
Spring 2017 was another successful semester in the Investor Advocacy Clinic. Student interns Qudsia Shafiq, La’Nise Harrington, Majda Muhic, Hector Rojas, Geoff Hafer, and Robert Noens (pictured above) spent approximately 700 hours helping investors in more than 20 matters. They interviewed investors and evaluated potential claims, analyzed damages theories and account statements, negotiated, and developed deep relationships with their clients. They commented on FINRA rule proposals and drafted several dozen investor education pieces on this blog. We will miss our graduates La’Nise, Majda, Hector, and Geoff and wish them the best as they study for the bar and begin their legal careers. We look forward to welcoming back Qudsia and Robert for IAC II this upcoming fall.
The Investor Advocacy Clinic’s work includes legal representation of regular people who have been harmed by their broker’s actions. We bring legal actions seeking damages to help make our clients whole. But our work doesn’t stop there. We focus on education so investors will never find themselves needing our legal services. We are actively engaged in the regulatory process, monitoring for new regulations and laws that might impact regular investors and critically analyzing the proposal to share with regulators how proposed laws might impact small investors.
Recently, clinic director Nicole Iannarone was quoted by Investment News in the article Elder Abuse Prevention by Advisers Depends on Their Firms’ Response to New Rule. The article outlined the SEC’s approval of a new FINRA rule aimed at preventing financial exploitation of adults who may have diminished capacity. Professor Iannarone discussed that while FINRA’s new rule is a welcome addition to the regulatory scheme, in order to protect investors fully it should go even further. Her comments echoed those of Investor Advocacy Clinic student interns David Hsu and Christopher Pugh, Jason Robinson, and Darius Wood who drafted comments concerning the initial rule proposal.
Professor Iannarone’s academic research focuses investor protection and legal ethics. She recently worked with her clinical colleagues at other institutions to draft a series of articles concerning the impact of diminished capacity on all parties in investing and securities arbitration proceedings. The first piece, A 360 Degree View of Roles and Responsibilities Concerning Diminished Capacity: Financial Advisers’ Obligations to Clients, Lawyers Representing Clients, and Lawyers Preparing their Practices, co-authored with University of Miami Investor Rights Clinic Director Teresa Verges and Pace Law School Investor Rights Clinic Director Elissa Germaine provides an overview of the problem of diminished capacity in investment transactions and introduces three articles in a series. The first article in the series, The Broker-Dealer’s Role in the Detection and Prevention of Elderly Financial Exploitation, written by Professor Verges, attacks the problem from the broker dealer’s perspective. The second article, Lawyers’ Obligations When Representing Clients with Diminished Capacity, written by Professor Germaine, outlines lawyers’ responsibilities when working with clients who may be suffering from diminished capacity. The final article, written by Professor Iannarone, Keeping Our Houses in Order: Lawyers’ Obligations Concerning Our Own or Our Colleagues’ Inability to Competently Represent Clients, addresses lawyers’ responsibilities to protect their own practices from the impact of their own potential diminished capacity.
The Georgia State Law Investor Advocacy Clinic continues to monitor regulatory developments that might impact regular investors and conduct research on cutting-edge issues facing investors.
The Georgia State University College of Law observes winter break from December 16, 2016 until January 5, 2017. While we will continue to post to this blog, pursuant to University guidelines, our physical office will be closed and we will be unable to respond to inquiries during the break. Please be aware that the passage of time can impact a potential claim. If you have a legal concern while we are closed for the break, we urge you to contact another attorney.
Starting in spring 2016, Georgia State Law will offer a new experiential course, the Business Arbitration Practicum. Assistant Clinical Professor Nicole Iannarone received a College of Law Innovation Grant to create the new course, which will offer students the opportunity to learn and practice interviewing, counseling, advocacy and negotiation skills in the context of an arbitration proceeding. The course, which will be a pre- or co- requisite for participation in the Investor Advocacy Clinic, is open to all students, including students who are unable to participate in the clinic due to conflicts of interest or time constraints. Class sessions will center on simulated problems. Students will interview their clients, research claims, initiate and answer proceedings, prepare for a final hearing and represent their clients in a live negotiation. Students will receive substantial feedback on their lawyering skill development from their professor and practicing attorneys.
By: Jason Robinson, Summer 2015 Graduate Research Assistant
The Financial Industry Regulatory Authority (FINRA) recently issued an Investor Alert entitled Plan for Transition: What You Should Know About the Transfer of Brokerage Account Assets on Death. The alert provides investors with useful tips concerning estate planning for non-retirement accounts. Continue reading