Meanwhile, those cashing out of a defined benefit plan are signing up with planners and brokers, seeking advice on decisions like whether it is better to take a lump sum or an annuity payout.
The brokers, on the advice of their own firms, had sold the partnerships to people looking for secure income-producing vehicles.
Indeed, the potential avalanche of bad investment advice stock brokers and financial advisers are peddling right now could prove just as devastating as the cliff.
Not surprising, then, that these consumers are going to the low cost, no-advice on-line brokers.
FORBES: On-Line Brokers and the (Unfulfilled) Promise of Tokyo's "Big Bang"
Wall Street's rank and file make their money by selling things: stocks by brokers, bonds by traders and advice by bankers.
The full-service firms say that they are confident that the personal advice offered by their brokers, along with the quality of their research, justifies their much higher costs.
For example, mortgage brokers are pushing a product, not giving financial advice.
Insurance brokers defended the fee flow and said it never tainted their advice.
These brokers, employed by the major wirehouses, have been providing conflicted advice to pensions in our state for years.
FORBES: Murders and Pensions: The Need for Forensic Investigations (March 28, 2006 )
In the past, brokers have justified their high fees by pointing to the quality of their advice.
Keep in mind that some brokers or insurance agents may be part-time fiduciaries for their investment advice but nothing else.
FORBES: Is Your Financial Advisor A Wolf In Sheep's Clothing?
The regulators conducted coordinated exams of brokers in 24 jurisdictions and were hoping to identify problems and pass along some advice on best practices.
Now that investors can get advice and market information from many sources other than full-service brokers, they are less willing to pay a premium just to trade.
Former clients filed suits against Salomon, Spartis and brokers who worked for him, charging they suffered severe losses due to risky advice to exercise their options and hold on to WorldCom's volatile stock.
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