Investment Advisor Claims Examples

A client calls an investment advisor with discretionary authority and asks him to buy a specific stock in his portfolio. Subsequently, the stock declines significantly. The client brings a claim for the loss, insisting that the amount of stock purchased was more than the guidelines allowed. The case was settled for an undisclosed amount.

A fund of funds investment manager invests two of his funds in a bond oriented mutual fund. The fund makes an interest rate bet, and loses significant capital. The investment manager’s investors brought an action claiming failure to adequately review the fund manager and misrepresented the risk of the fund, and won an award in excess of $20.0 million.

A city pension plan administrator brought a claim against a fund manager and the insured consultant hired to perform investment performance review services. On behalf of the pension plan the administrator alleged breach of investment guidelines against the fund manager and failure to identify and disclose the alleged breach against the consultant. The case was settled for an undisclosed amount.