On television, financial news shows in the late 1990s were reporting astounding gains on stocks by the minute. Some clients pushed their brokers to deliver the big profits they were hearing about. Some brokers undoubtedly saved customers from bad decisions. The really competent broker would say, Because it will go down as fast as it goes up, said James Eccleston, a Chicago lawyer who handles investor claims against brokers. Lawyers for investors and brokers agree that many complaints arise because investors don t understand what they are signing.
Brokers often fill out new-account forms based on an interview with the client over the phone.
Then, when problems occur, clients are sometimes surprised to find that their account forms list them as a speculative or aggressive investor. Many investors also assume their broker knows what he or she is doing. Edward Jones declined comment. Understanding the risks of margin can be another problem. On the account form they signed, they had to check a box if they did not want to use margin.