Investor Rights Clinic Fellows and rising third-year students Matthew Bacon, Taylor Bandy, and Brooke Nelson traveled to Washington, D.C., with the IRC’s Director, Teresa Verges, for two unique opportunities to advocate on behalf of retail investors, meeting with both the Securities and Exchange Commission’s Office of the Investor Advocate and Congressional staffers on consecutive days.
On April 4, the IRC fellows joined student interns from eight other law school securities arbitration clinics for the SEC’s inaugural Investor Advocacy Clinic Summit. The law school clinics assist investors who suffer losses due to broker misconduct, but who cannot find legal representation due to the smaller size of their claims.
The summit included break-out sessions to discuss private placements, investor experiences with mutual funds and variable annuities, and how to combat retail investor fraud. In the afternoon, each clinic made a presentation focused on a specific problem or issue affecting investors, and proposed solutions to address the problem. Miami Law’s presentation focused on the limits of disclosure and explored how existing and developing technology may be used to provide meaningful disclosure to retail investors. Summit speakers included Commissioners Robert J. Jackson and Elad L. Roisman, and SEC senior staff from across the agency.
“The Clinic Summit provided us with the invaluable opportunity to discuss trends and issues in clinic cases,” said student intern Bandy. “We were then given the opportunity to voice concerns and advocate for increased, meaningful disclosure requirements to protect retail investors. It was great to have high-ranking members of the SEC engaging in our discussions about using technology to maximize disclosures to investors.
“It was an incredible opportunity for us to share insights learned from helping retail investors, and offer practical solutions to those who decide policy,” Bandy said.
The next day, on April 5, Bacon, Bandy, and Nelson advocated investor interests before congressional staffers on Capitol Hill during the annual Hill Day, sponsored by the Public Investors Arbitration Bar Association. PIABA members are attorneys who represent investors harmed by broker misconduct. Verges and the student fellows joined 60 other student interns and PIABA attorneys, who participated in over 170 meetings with congressional staffers.
The student fellows advocated in support of legislation that would create an investor recovery pool funded by a portion of the penalties FINRA collects against member firms for violations. Bacon, Bandy, and Nelson also advocated in support of a fiduciary duty of care for brokers towards their clients, and against mandatory arbitration.
“I had the privilege to share client stories to explain how the system is not only far from perfect, but it is in desperate need of change,” said student intern Nelson. “Without help from people that have the ability to make legislative changes, the problems will continue to proliferate.”
“Overall it was an exhilarating two days of investor advocacy for our Fellows,” said Verges. “Although we provide our interns with first-hand experience and training in handling live-client cases, opportunities like the SEC’s Investor Advocacy Clinic Summit and Hill Day demonstrate alternative approaches to investor and client advocacy.”
