New York Securities Lawyer Blog
Lax & Neville LLP is investigating claims against brokerage firms for the sale of auto-callable notes to customers or investors.
An auto-callable note is a complex, highly risky structured product that can result in a complete loss of principal. Financial advisors at brokerage firms are highly incentivized to recommend these structured products to their customers despite the facts that these auto-callable notes may neither be suitable nor in the best interests for their customers.
Prior to recommending these investment products to investors, financial advisors are required to fully explain the details and risks of these complex investment products, such as, illiquidity due to the highly customized nature of the investment; market risk, including market volatility or changes in the underlying stock or index; and credit risks, including defaulting on its debt obligations, which could expose investors to lose some, or all, of the principal amount they invested as well as any other payments that may be due on the structured notes.