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Full-Text Articles in Law
Brokers And Advisers-What’S In A Name?, Barbara Black
Brokers And Advisers-What’S In A Name?, Barbara Black
Faculty Articles and Other Publications
The article addresses two recent developments - the adoption by the SEC of a rule that allows brokerage firms to market fee-based accounts without registering as investment advisers and the increase in brokerage advertising that promotes the image of the broker as a trusted family friend and financial adviser. Professor Black argues that as a result of these developments investors are likely to be misled into believing that their brokers are investment advisers, with the fiduciary obligations the law requires of them, instead of brokers, whom the law generally treats as salespersons. She proposes two recommendations: (1) that brokers should …
The Elusive Balance Between Investor Protection And Wealth Creation, Barbara Black, Jill Gross
The Elusive Balance Between Investor Protection And Wealth Creation, Barbara Black, Jill Gross
Faculty Articles and Other Publications
The enactment of federal securities legislation in the 1930s codified the principle that investors should be shielded from securities fraud, but scholars and policymakers continue to debate the appropriate balance between protecting investors and encouraging capital formation. Congressional activity of the past decade reflects this tension. In the 1990s, Congress enacted two major pieces of legislation to restrict securities fraud class actions because of its belief that frivolous class actions were a drain on entrepreneurism. In 2002, after the EnronIW orldCom et al. corporate scandals, reflecting perhaps a sense that the earlier legislation had tipped the pendulum too far, Congress …