Corporate & Securities Law

Schwab YieldPlus Fund Arbitration Award Issued

By Keith Griffin

Charles Schwab & Company has been hit with yet another arbitration award connected to its Schwab YieldPlus Fund. On May 29, 2009, a FINRA arbitration panel in Minneapolis, Minnesota, awarded more than $14,500 plus interest to Gary Wilhelm on claims of negligence and misrepresentation on the part of the San Francisco-based investor firm and the sale of the Schwab YieldPlus Fund. 

According to the award (FINRA # 08-02118), Wilhelm invested a portion of his retirement IRA in the Schwab YieldPlus Fund based on recommendations by Charles Schwab that it was a ?safer alternative to money market funds but with higher yields.? Despite assurances from Charles Schwab that the YieldPlus fund was low risk, it actually contained a high concentration of mortgage-backed securities. Following the onset of the mortgage loan crisis in 2007, the Schwab YieldPlus Fund plummeted in value and produced millions of dollars in losses for investors.

Full post as published by Representing Investors on June 29, 2009 (boomark / email).