While most small investors are better served by using a discount broker, there are times you may want to invest with a real human being. If you’re that kind of highfalutin investor, you can now see if a broker has a “record.”
The National Association of Securities Dealers “BrokerCheck” is new-and-improved, letting you pull up the record of complaints and investigations against the broker.
See if there are any events listed under Disclosure of Customer Disputes, Disciplinary, and Regulatory Events.
“If there is a proliferation of consumer complaints against a broker, that would certainly be a red flag,” Davidoff says.
David Bayless, a former SEC attorney now with Covington & Burling, says he would be especially concerned if the broker had state or federal disciplinary actions.
Be sure to click “View Full PDF Report” if you want the lowdown. Otherwise, it’s just summary info that doesn’t help you much. — MARK ASHLEY