Lawyers at Vernon Litigation Group File Another FINRA Arbitration Claim Involving the Sanford Bernstein Options Advantage Fund

NAPLES, Fla., July 7, 2023 /PRNewswire/ -- Vernon Litigation Group, representing investors nationwide that invested in the Sanford Bernstein Options Advantage Fund, has filed another formal claim with FINRA. This claim is on behalf of Florida retirees.

The focus of the latest Claim continues to be on the Options Advantage Fund created and pitched by Sanford Bernstein to its own clients. The Fund suffered significant losses before closing in October of last year. According to the latest Claim, the retirees were led to believe that they were investing in a low-risk strategy designed to generate extra return on the couple's existing portfolio. The projected net returns for the recommended Fund were in the range of 2%. As part of this Fund strategy, Bernstein recklessly recommended that its clients utilize margin (i.e., utilize their existing investment portfolio as collateral to borrow money from Bernstein) to invest in this Fund, according to the Claim. As a result, one of the many troubling aspects of this strategy was the uncompensated risk to which Bernstein was exposing its own clients, according to the Claim.

This latest FINRA arbitration filing asserts that Sanford Bernstein mismanaged the Fund by, among other things, disregarding interest rate movements and volatility over the life of the Fund. Rather than moving its clients to safer investments that would rival the 2% return goal of the Fund when interest rates and volatility increased, Sanford Bernstein continued to prioritize its own interest ahead of its clients (according to the latest FINRA Claim filed by Vernon Litigation Group).  

According to the Claim, the wrongdoing of Bernstein damaged the retired Florida couple in terms of fees paid to Bernstein, interest paid to Bernstein, losses and damages suffered due to the recommendation and management of the Bernstein Fund, and the creation of debt obligations to Bernstein.   

Bernstein focuses on high net worth clients with offices in areas with high concentrations of wealth such as West Palm Beach, Tampa, Miami, Atlanta, Nashville, Boston, Chicago, Cleveland, Dallas, Denver, Houston, Los Angeles, Minneapolis, New York, Philadelphia, San Diego, San Francisco, Seattle, Stamford, Tel Aviv, and Washington, DC.

The attorneys representing the Florida retirees noted that cases like this – involving institutional wrongdoing as opposed to rogue broker situations – often include the calculated use by the investment firm of terminology that downplays the risks as part of the client pitch. In this case, Bernstein referred to this Fund as an overlay strategy with no up-front cash investment required. The attorneys also point out that another common theme in these types of cases is the post-damage offer of free investment advice to avoid getting sued. Vernon Litigation Group believes these institutional strategies are breaches of the investment firms' duties and obligations to their own clients. According to Vernon Litigation, in these types of cases, they often get calls from individual financial advisors with concerns that their own firm did not accurately detail the product or strategy to them. 

If you or someone you know invested in the Sanford Bernstein Options Advantage Fund, Vernon Litigation Group recommends that you speak with the law firm's securities attorneys, who will provide you with a free and confidential overview of the claims you may have as well as your legal options in this situation. 

Vernon Litigation Group is based in Naples, Florida and has been successfully representing investors throughout the United States for decades, with lawyers licensed in Florida, Tennessee, and Massachusetts. Visit our website at http://www.vernonlitigation.com/ or contact Vernon Litigation Group by phone at 1-877-649-5394 or by e-mail at [email protected] to speak with a representative of Vernon Litigation Group.

SOURCE Vernon Litigation Group