BU Law emerita professor Tamar Frankel discusses an emerging issue affecting financial advisers—when a client may exercise control over the actions of the adviser. Frankel relates the story of an investment adviser that did not follow the client’s orders to cease certain investments, at a cost of almost $5 million to the client. As Frankel explains, the Securities and Exchange Commission (SEC) got involved, resulting in the investment adviser’s settlement for a significant payment to the client and other conditions.
Boston University law professor Tamar Frankel comments on the increased use in “robo-advisers”—machines that purport to offer investment advice and order the performance of their advice by securities trades. Frankel describes how the Securities and Exchange Commission has responded to the rise in robo-advisers and summarizes some of the legal challenges they present, particularly when used by brokers and by financial advisers.