This article appeared originally in the February 2008 Levitt Letter.
Dear Dr. Seif,
Please examine some recent articles by Mark Levitt. In the June, August, October and December Levitt Letters, Mr. Levitt has written sweeping generalizations stating how self-serving financial planners are. Mark’s inane babble against all financial professionals is prejudiced, juvenile, and astonishingly uninformed. What kind of experience in the financial services industry does Mark have? A lot of financial planners are born again and truly care for and do great jobs for their clients.
I’m an ordained minister and 16-year veteran of the financial services industry. I can tell you for a fact that Mark’s comments are flat-out wrong, deceptive, and potentially harmful to your readers. Investors without guidance usually do the wrong thing at the wrong time. Mr. Levitt is obviously blinded by personal prejudices and has absolutely no idea what he is talking about. His false characterizations reflect poorly upon ZLM.
J.S.
Dear J.S.—
Thanks for pointing out that generalizations do not apply to individuals. Like the similar mortgage brokering industry, which is now in a state of meltdown, the stock brokerage profession has systemic problems, ones which can tempt or force brokers away from what’s best for their clients.
In 2000, I was as wise as a dove when it came to investing. I trusted implicitly a Christian stockbroker whom I’d met through the Cub Scout troop at my children’s Christian school. Unfortunately, he worked only to generate income for himself while ravaging the savings of Zola, Sandra, my wife, my children, my mother-in-law, this ministry, and me. He traded at his discretion without proper authorization. Then I got to see from inside how dishonest and biased against the investor the NASD crony arbitration is.
Even this ministry’s best researcher could not locate any public record of our family’s multiple cases against the broker or brokerage. The paltry judgment amounts awarded to Zola and my wife for their IRA losses are well-kept secrets to this day—even though that same broker has had two subsequent complaints upheld against him.
Visit www.levitt.com/newsletters/2003-09.pdf (p. 21) to read about Eliot Spitzer, “The Sheriff of Wall Street.”* He was the attorney general of just one state, New York, so why did he take it upon himself to hotly pursue national investment firms? Answer: he believed the SEC and NASD weren’t doing enough. The awards that Spitzer won were slaps on the wrist. Now that he has become governor, I can hear the wolves of Wall Street asking investors, “Where’s your sheriff now?!”
J.S., I stick by my guns on recommending the experts cited in my articles: Scott Burns, Daniel Solin and, for investors who want assistance, the flat-fee consultants at Vanguard. As I’ve said, human nature is the culprit, not well-meaning Believers like you. (Dear Reader: Commissions on investments facilitate conflicts of interest that make me wonder why brokerages are paid based on the amounts you invest rather than on how much they make for you.)
—Mark
P.S. www.wikipedia.com’s description of the NASD includes: “Being an industry organization, the NASD has been accused of turning a blind eye to broker/dealers’ biggest abuses.”
*Or see www.cbsnews.com/stories/2003/05/23/60minutes/main555310.shtml