According to dealbreaker’s Matt Levine Don’t do this: One particular municipal entity had been a
customer of Wells Fargo, or a predecessor, since at least 1988. This customer’s
investment objectives were safety of principal and income. … Wells Fargo’s
internal records for the customer’s account specifically stated that the
account should not invest in MBS. In addition, applicable state law prohibited
municipal entities such as this customer from investing in certain “high-risk
mortgage-backed securities.”
Never-theless on
April 30, 2007, respondent McMurtry selected and purchased Golden Key on behalf of the
customer. McMurtry did not know what a SIV was at that time he selected Golden
Key for his customer. Further, he did not read the PPM for Golden Key, nor did
he inform the customer of the risks related to the SIV structure or the
underlying high-risk mortgage-backed assets held by Golden Key.
Well, I mean, in his defense it seems that McMurtry had a
very good excuse for not informing the customer of the risks of Golden Key,
specifically that that he didn’t know what those risks were, or what Golden Key
was, or presumably where he was or how he got there or how many fingers the
customer was holding up.
The world is safe from Shawn McMurtry for the next six
months, since he and his employer entered into a settlement with the SEC today
suspending him and fining Wells $6.5 million for its unconcern with the fact
that its salesmen were not particularly interested in doing their jobs and/or
illiterate……
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