Ensure Funds Are Invested as Requested
Ensure Funds Are Invested as Requested08.11.2014
Registered Representatives can help themselves avoid loss
and reduce exposures using a few simple tips. Try using the below loss
prevention tip to improve your risk management strategy:
Claim Scenario: The client instructed the registered representative to buy $20,000 of a certain stock. One month later, the client called the registered representative to sell the stock. At that time, the registered representative realized he never executed the original buy order.
Estimated Claim Cost: $11,000
Loss Prevention Tip: Periodically check the client’s account to ensure the funds were invested as requested. Had the registered representative heeded this advice, he would have realized much earlier that the requested buy was never executed and could have mitigated his client’s losses. Additionally, having a specific procedure in place for all trade requests can help reduce the chance of these types of errors. In this instance, the request was made in an email to the registered representative as part of a conversation regarding a different topic. Had the request been through a specific procedure for trade orders, the error likely would not have occurred.
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.
Written by CalSurance Team Published August 2014