Find out how communication can help prevent E&O claims
for Broker/Dealers and their Registered Representatives:
Claim Scenario: The client was in the process of divorcing her husband and submitted a request to her financial advisor to place a hold on their joint brokerage account until their divorce was finalized and accounts were divided. The advisor failed to submit this request until the following day. By the time the advisor submitted the documentation to place the hold on the account, the client’s husband had withdrawn all of the funds from the account. As a result, the broker/dealer had to pay the client her rightful share of the account proceeds prior to the account being depleted.
Estimated Claim Cost:
$170,000
Loss Prevention Tip:
Ensure that paperwork for all transactions is complete, accurate and submitted
timely. Errors & omissions claims for financial advisors can often be the
result of failing to timely execute transactions. It is imperative that the
client’s account transaction requests are executed the same day. If there is
some reason for a delay in processing the client’s request, advise the client
immediately.
All information provided in this blog is for informational
purposes only. The sources used are presumed accurate. CalSurance Associates,
Brown & Brown Program Insurance Services, Inc. and Brown & Brown, Inc.
will not be liable for any errors, omissions, losses, injuries or damages
arising from its display or use and will not assume responsibility for any
misguided information. No guarantees are implied.
