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Litigation, Arbitration, Expert Witness
See also Expert Witness Qualifications
In the late 80's and 90's, I acted as a NASD arbitrator. I tended to side with consumers since the industry is seriously flawed in its knowledge. I did not arrogantly or maliciously deliberate for the plaintiff, but there simply is not a sophistication with securities, insurance or planning brokers or agents. I have been an instructor for securities licensing and the fundamentals of investing have never been taught- since they are not tested. Insurance is a minefield. The major designations in planning are essentially one semester of college- and also do not address real life applications. They still do not address standard deviation properly, nothing on no lapse insurance, Equity Indexed Annuities, etc.
Consumers are not blameless due to their own arrogance and ego- but the industry is generally stacked against them. As such, my current focus is the analysis of securities and insurance strategies that are unsuitable. I have submitted reports and testified on GNMA's, variable products, life insurance, mutual fund allocations, diversification, etc.
All that said, you need to recognize that the attorneys, arbitrators as well as the NASD and SEC are also effectively clueless on the fundamentals of investing- alpha, beta, correlation (very difficult), standard deviation and more. If you are a consumer comtemplating arbitration, I urge you to read my book, No Nonsense Finance as well as Does Your Broker Owe You Any Money by attorney Dan Solin. Don't do anything before reading these.
Also recognize that any report or testimony by an expert is only as good as the attorney doing the arbitration. I recently finished a $300,000 settlement on a case and note that 6+ of the top securities attorneys in Florida had not bothered to read material that had been given to them. I didn't "bamboozle" them into the $300,000- I just perceived they were so arrogant that they wouldn't bother to do the necessary homework. While that may sound impressive, recognize that it can also work against a case if the parties are unfamiliar with such fundamentals and refuse to listen to facts. The bulk of the arbitrations, mediations and settlements are based on secondary issues removed from real life application. Caution is advised since legal measures- including arbitration- do not have to make sense. And the emotions and stress run very high- more so as the parties threaten each other with all sorts of legal strategies and delays. It really is pretty pathetic overall and can cause many a lost nights' sleep. Be prepared.
A lot of the suitability aspects I address may be developed in working on a financial plan and noting what an adviser previously had done. However, rather than pass it off as past history as most advisors do, I take an active stance in trying to get money back. I worked on a separate case for an elderly woman who had been sold an ING variable life policy and had absolutely no need for the insurance. (She thought she could "trust" the agent and he was doing the right thing for her. He now sells swimming pools.) The company would not budge until I got an arbitration filed. Within two weeks, they gave back the entire amount plus a couple extra thousand. That's not the norm since most cases under $50,000 will not be touched by an attorney and no funds are ever recovered. But this was a financial planning client and I therefore felt a fiduciary duty to pursue the unsuitability.
Fees are generally quoted on an hourly rate since it is difficult to know what is involved and quote a contract rate. Reports are $250 per hour- testimony at $375. Have provided testimony in other states besides California- Louisiana, Florida and Tennessee, for example, and am therefore willing and able to travel as necessary.
Email at efm@efmoody.com
Call at 510 352-4127
510 459-7797 (Cell)