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Douglas J. Schulz, Financial Planning, November 11, 2024

Embattle broker Chuck Roberts lands Stifel another multimillion-dollar penalty. Douglas Schulz, a securities expert and the President of Invest Securities Consulting, said it’s not especially surprising that Roberts remains at Stifel. Many times, Schulz said, firms seek to give themselves a bit of legal protection by keeping embattled brokers on the payroll throughout ongoing litigation. If they fire him, he may become an adversary and antagonistic and maybe say things like, ‘I wasn’t properly supervised’”, Schulz said. “As long as you keep him in house and pay his legal fees, you have a better chance of controlling what he may testify to.” Schulz said he wouldn’t be shocked at all if Roberts were eventually let go after all the legal dust had settled. “With the size of these awards, his annual production can’t be so big that this is perceived just as the cost of doing business”, Schulz said.

Douglas J. Schulz, Financial Planning, October 7, 2024

A three-person Financial Industry Regulatory Authority panel hit Stifel on Thursday with a $14.3 million award over a complaint regarding a troubled broker's recommendations of complicated investment vehicles known as structured notes. These notes are a type of debt security often offering high returns but also often coming with substantial risks and fees. The bulk of the order against Stifel consists of $9 million in punitive damages — an amount one industry expert called proportionally one of the largest such awards he's ever seen. Douglas Schulz, a securities expert and the president of Invest Securities Consulting, said it's rare for arbitration panels to provide punitive damages in the first place and doubly unusual for the amount to be so large. "Clearly, the arbitration panel thought there was liability, and the wrongdoing was egregious," Schulz said… Schulz said the $9 million in punitive damages is the kind of award that can be used to show firms that neglectful and possibly deceitful practices aren't tolerated. Arbitrators, he said, too often shy away from large penalties for fear that the industry will seek to bar them from serving on future panels. "It's about time," Schulz said. "This has got to happen more often because it's the sort of thing that could help force the industry. For some firms, even a $9 million punitive damage doesn't register. But if you get more of these, they could add up to something."

Douglas J. Schulz, Financial Planning, June 13, 2024

Well Fargo was hit with an award that consisted of $81,885 in compensatory damages, $250,000 in punitive damages, $8,475 in costs, $150,000 in attorney’s fees and $5,000 for witness fees…“Douglas Schulz, a securities [expert] and the president of Invest Securities Consulting, said punitive damages in FINRA arbitrations cases are extremely uncommon. So the panel in this dispute clearly thought the alleged violations were serious. “Rare isn’t even the right word’, Schulz said. ‘So good for the arbitration panel members for taking a stance when somebody violates the rules and beaks the California code and letting them have it.’”

Douglas J. Schulz, Financial Planning, January 2, 2024

According to FINRA, LPL failed to ensure that its representatives were properly logging their business dealings, resulting in 830,000 transactions not being adequately recorded between January 2012 and August 2019. The firm also stood accused of failing to collect clients' profile information — data needed to gauge whether any possible investment recommendation is actually suitable — for $2 million trades. Douglas Schulz, a securities lawyer and the president of Invest Securities Consulting, said the fines seem vastly disproportionate to FINRA’s allegations against LPL. It would almost be easier, Schulz said, to list the rules that LPL wasn’t accused of breaking rather than those that it was. “If the ultimate goal is the protection of investors, I tend to go to the top, and the top is the regulators”; Schulz said. “And when I see this much wrongdoing for this many years before someone says anything, then I’m very critical of FINRA.”

Douglas J. Schulz, Financial Planning, July 20, 2023

One of the cases highlights how financial exploitation of older Americans amounts to as much as $28 billion each year. But they both underscore why investors should be skeptical of any vehicle requiring them to move assets off platforms subjected to regular scrutiny by firms and regulators to outside entities controlled by an individual broker, according to fraud expert Douglas Schulz of Invest Securities Consulting. A “day and age of widespread fraud” requires constant diligence, whether investing online or with a financial advisor, Schulz said. “I would say it's as bad today as I’ve ever seen it. The scamsters are very good. They're very smart,” Schulz said in an interview. “It’s rampant, and the regulators — you can't rely on them.” “They don't just fleece one person, they take down a bunch,” Schulz said. “You catch them, and they don't have any money. The net result is horrible. Yes, you can try to sue the advisory firm and the brokerage firm and we win maybe half those cases. But we don't win them all because the argument is, ‘Well the broker hid it from us, too.’”

Douglas J. Schulz, Financial Planning, June 29, 2023

Douglas Schulz, the president of Invest Securities Consulting, said the case shows how easy it is for sales representatives to move on from a firm that that’s under regulatory scrutiny. “Here we go again”, he said. “You catch them, and you disclose the entity they worked for. But you don’t really do anything about the people who were in control. So what’s the point? What did you accomplish?”

Douglas J. Schulz, Financial Planning, May 11, 2023

Douglas Schulz, the president of Invest Securities Consulting and a longtime FINRA arbitrator, said DeGregorio, given his past, should have caught regulators attention earlier. “It has always been a given that a broker who switched broker-dealers regularly, in two years or less, that is an absolute red flag”, Schulz said. “And the firms hiring a guy who by definition had a checkered past should have been asked: Why are you hiring someone who switches firms more often than I change my underwear?

Douglas J. Schulz, Financial Planning, March 22, 2023

Regulators and law enforcement authorities have “made abuse of seniors/elders major priority” in recent years, said fraud expert Douglas Schulz of Invest Securities Consulting in Westcliffe, Colorado. “It is a priority, it should be a priority and there are numerous bad actors who target seniors.”

Douglas J. Schulz, The Wall Street Journal

In the Wall Street Journal both Mr. Manson (arbitration scheduled for late October 2018) and Mr. Dielman are cases where I am/was the Claimant’s securities expert. I’m especially proud of the Dielman case (Mr. Dielman and his wife, in addition to being wonderful people, Chris is one of the more famous lineman in NFL history) because we received a $1.1 million award and I was the sole expert for the Claimants where the Respondents had 3 experts! Additionally, I think you will agree that the $1.1 million award is quite an accomplishment considering that my client made $3.7 million in his account.

Douglas J. Schulz, Financial Planning, 2021

“You find the products that pay the highest commissions and you'll find the products where most of the abuses occur,” said fraud expert Douglas Schulz of Invest Securities Consulting. UIT’s have "always been a problem," he said, because clients have trouble with all the different types of fees collected upfront, during the investment and at the end. “It's almost impossible for them to really figure out and know what are the charges and potential charges,” Schulz said.

Douglas J. Schulz, Wall Street Journal

“Being an accredited investor does not today make you wealthy, and it absolutely does not make you sophisticated, said Douglas Schulz, a former investment adviser who testifies in arbitrations for investors."

Douglas J. Schulz, New York Times

"That he (Johnny Burris, JP Morgan) was the subject of three complaints is significant, because that is a threshold at which a broker may be subjected to “heightened scrutiny” by regulators. Most brokerage firms won’t consider hiring a broker with three or more such complaints, no matter what the disposition, according to Douglas J. Schulz of Invest Securities Consulting. “It’s a very serious black mark,” he (Douglas Schulz, Invest Securities Consulting) said."

Douglas J. Schulz, Albuquerque Journal

Rosenstiel’s securities expert Douglas Schulz concluded that Decades had “neither the expertise or experience in how to deal with diversifying and hedging” such a large concentrated asset. For Decades to say there are no damages to the estate, “is like trying to take credit for the sun coming up in the morning because you happen to be on your porch watching,” he wrote in a report.

Douglas J. Schulz, Denver Post

“Schwab would like everyone to think that it does not have conflicts, but that’s not totally true,” says Douglas Schulz, expert witness in security fraud trials and author of Brokerage Fraud.”

Douglas J. Schulz, Forbes

“If you don’t have a contract, there’s no fiduciary relationship, and you’d have a much bigger up-hill battle,” says Douglas Schulz, Co-Author Of The Book Brokerage Fraud.

Douglas J. Schulz, Money Magazine

“The settlement represents pennies on the dollar compared to the $7 trillion that U.S. stock markets have lost from their peak,” said Douglas Schulz, of Colorado Springs, a former stock broker who now serves as an expert witness in securities fraud cases. “The investigations, which are ongoing, should make it easier for thousands of investors seeking restitution for the losses they suffered,” said Schulz, co-author of “Brokerage Fraud: What Wall Street Doesn’t Want You To Know.”

Douglas J. Schulz, Denver Post:

Schulz, author of Brokerage Fraud, said, “Brokerage firms have lost credibility in light of wide-spread media reports of fraudulent and reckless conduct and that has heightened the skepticism of arbitrators.”

Douglas J. Schulz, Lawyers Weekly USA:

“They’re (Internet brokerage firms) learning at the public’s expense and that’s not right”, says securities expert Douglas J. Schulz, from Invest Securities Consulting, Inc. of Westcliffe, Colorado, who has accounts at six different firms.

Douglas J. Schulz, Business Weekly:

“Investors often have a better chance of winning a margin dispute if the firm made some additional representation or misrepresentation, such as incorrectly telling the customer that there is no margin call or giving the customer time to meet a margin call and then liquidating the stock before the deadline.”

Douglas J. Schulz, Wall Street Journal:

“The marketing campaigns by these internet brokers encouraged novice investors, who had no business trading securities, to short-term trade stocks, and in many instances ended up losing a major of their net worth.”

Douglas J. Schulz, Wall Street Journal:

“What was the basis for recommending the stock? What materials did you rely on?”

Douglas J. Schulz,
The American Lawyer:

“If a big guy with lots of money and a good education can win, then the opportunity for justice is strengthened for the small guy.”

Douglas J. Schulz, The Sun Sentinel, Florida:

“Should you cut your losses and bail out? First, take a look at the partnership’s quarterly and annual reports. If a partnership’s distributions exceeds its income, all it’s doing is paying out capital and you’re probably better off getting out.”

Douglas J. Schulz, Kiplinger’s Personal Financial Magazine:

“The chairman of the panel halted the proceedings and ordered the investor into the hallway—without his lawyer—to try to reach a settlement with the brokerage representative…”

Douglas J. Schulz, Money Magazine:

“They’re thumbing their noses at the SEC.”

Douglas J. Schulz, Business Week:

“For Schwab to be portraying itself as totally conflict free is somewhat misleading—they have many of the same conflicts as the big houses.”

Douglas J. Schulz, Institutional Investor:

“If you don’t see why I’ve called certain investments highly risky, I’ll explain. For example, suppose a broker sold you a bond by telling you his firm has cornered the market in that issue. Sound interesting? It might mean only that the issue is thinly traded and hard to unload except on gullible customers.”

Douglas J. Schulz, Medical Economics:

“That the payment system was not disclosed is a whole new area of fraud,” said Douglas Schulz, a securities expert who has participated in investigations into the firm’s sale of limited partnerships in the late 1980’s and who has testified on behalf of plaintiffs in the case. “The big question now is will the U.S. Attorney General or the SEC open the books back up on Prudential.”

Douglas J. Schulz, The New York Times:

“Just because you’re rich, doesn’t mean that you know anything about investment markets,” said Douglas Schultz, head of Invest Securities Consulting, Inc. in Dallas, who testified as an expert witness in the case. “The securities regulations are not socialistic, they apply regardless of your wealth.”

Douglas J. Schulz, The New York Times:

“$2.6 million dollar award, The message being sent by this and other awards is: You can’t abuse investors’ accounts and then use as a defense the fact that they are wealthy.”

Douglas J. Schulz, The New York Times:

“$2.6 million dollar award, The message being sent by this and other awards is: You can’t abuse investors’ accounts and then use as a defense the fact that they are wealthy.”

The authors have taken the rules and regulations of he brokerage industry and put them in laymen s terms.

Professor William C. TysonThe Wharton School & The Law School of the University of Pennsylvania

The Book, Brokerage Fraud is a must read for all compliance professionals and brokerage firm's compliance and legal departments.

Complinet.com

This book is a timely wake up call to the brokerage industry to clean up its ways.

George D. MullenVice President UBS PaineWebber

Tracy Stoneman and Douglas Schulz certainly know what Wall Street brokerage firms wish you didn't.

Evan CooperEditor-in-Chief, On Wall Street, Co-Author

This book can save you thousands of dollars and loads of headaches!

Jordan E. Goodmanauthor of Everyone's Money Book

Had "Brokerage Fraud" been available to my wife and I eight years ago, it may very well have saved us the fortune we lost to a mercenary industry that promotes itself as caring and responsible, when in fact it cares mostly for itself.

"Brokerage Fraud" is frank and friendly, organized, comprehensive, easy to digest -- and quite unique, too, because the distinguished authors tell all about an autonomous, all-powerful institution that routinely sheers the uninitiated."

". . . I am an attorney and an investor. Yet, I must say that each chapter of 'Brokerage Fraud' brought new information and insight that is invaluable . ."

Where Expertise and Experience Meet!

Welcome to the home page of Douglas Schulz, a nationally recognized securities expert witness and the President of Invest Securities Consulting, Inc. Mr. Schulz is a Certified Regulatory Compliance Professional (CRCP) who has been retained in over 1,175 securities related matters. Mr. Schulz has testified in over 650 FINRA Arbitrations and civil cases regarding investment and brokerage disputes that have resulted in arbitration awards and settlements totaling over $383 million dollars.

FINRA Securities Arbitration Expert Witness and Consultant

Douglas J. Schulz, CRCP

Invest Securities Consulting , Inc.

Proven Quality Over Time

Today’s securities industry and securities fraud have become progressively multifaceted and complex. The new generation of securities violations, schemes, and securities fraud truly necessitate expert testimony. A securities expert witness’s testimony has become vital in reaching a successful resolution in securities arbitration today.

Client Services

A client-focused and solution-based company with a proven record, Invest Securities Consulting, Inc. provides clients with a full range of services relating to the securities industry

Areas of expertise

FINRA & SEC Regulations
Breach of Fiduciary Duty
Securities Fraud Investigations
Mutual Fund & Hedge Fund Mismanagement
Self-Dealing & Front-Running
Suitability
Securities Fraud
Unauthorized Trading
Churning
Options, Stocks & Bonds
Compliance Violations
Supervisor of Registered Representatives
Supervisory Violations and Lapses

Due Diligence
Concentration - Lack of Diversification
Order Failure
Illegal Discretionary Trading
FINRA Arbitrations
Securities Arbitrations
Broker Standard of Care
Broker/Brokerage Firm Malpractice or Malfeasance
Stockbroker Violations
Damage Calculations & Loss Analysis
Damages & Punitive Damage Analysis
Option Straddles and Strangles
Compex Option Hedging and Shorting Services

Inconsistencies in Trading Activities
Breach of Securities Regulations
Breach of Broker Industry Norms & Standards
Improper Sales of Limited Partnerships and Private Placements
Breach of Fiduciary Duty
Compliance Obligations for Registered Investment Advisors, RIAs
investment Fraud
Margin Calls & Liquidations
Fee & Commission Gouging
Cryptocurrencies
Third-Party Power of Attorney Accounts

Read what clients have said about
working with Mr. Schulz

August 2024 As an expert witness, Douglas Schulz is in a class by himself when it comes to securities and related matters. His depth of knowledge, wealth of experience, and ability to speak spontaneously on the spot, live at hearings and trials makes a tremendous asset when it comes to presenting a case. I’ve had the pleasure of working with Douglas Schulz for over 20 years. He has served as my expert witness in numerous of my securities cases. His knowledge of the securities regulations, norms, and standards of the securities industry is unparalleled. But what makes him so valuable to me and my cases is his willingness to be a resource on all aspects of my cases, including parts of the case one might not readily know, but for Douglas Schulz. He sets a pace that makes you and your case better. He can be a tough taskmaster because he is a stickler for detail, performs at a high level, and expects others to do the same. But he always gives more than he gets. He has a wealth of information not only in his head but also in his files, and he is apt to bring out relevant documents on any topic at any point. If you need something on the subject or close to it, he is capable of getting his hands on just about anything because he is connected with vast resources from being in the field so long. Being in the field for a long time and testifying for you on numerous occasions can be a detriment, but not in Doug’s case. This is because Doug has a depth of experience that becomes a credibility booster for him and the case. It ends up highlighting him as the recognized “go -to” master in the field and the courtroom, which he is. And when it comes to cross-examination, I have rarely seen a person as gifted as Doug, in being able to hold his ground and inflict so much damage on his opponent. In one trial after his testimony and with the opponent’s expert ready to testify (after monitoring the entire proceedings for days), the opposing expert refused to take the witness stand after hearing Doug Schulz’s testimony. That is the kind power a masterful expert can bring to a case. In that case, Doug’s testimony was totally unopposed even though the other side had an expert ready to testify but chose not to, which means, if you name Doug on your witness list, you have immediate settlement value and may not have to try the case.

Los Angeles, CA Securities Attorney

Featured

Douglas J. Schulz has co-authored a book with Tracy Pride Stoneman, distinguished securities lawyer about the brokerage industry. The book, was reviewed in the February 11, 2002 issue of Business Week Magazine! “The imperative to be a skeptical investor is a lesson most of us learn the hard way. That’s why you might do a favor for any friends who still use a stockbroker by giving them Brokerage Fraud: What Wall Street Doesn’t Want You to Know (Dearborn, $24.95). The authors, battle stockbrokers for a living. . . . they make enough of a case to get even very trusting investors to (wisely) think thrice about any broker’s advice”.

Mr. Schulz was a featured speaker at a November 2010 Wharton School of Business, FINRA Institute’s CRCP, Certified Regulatory Compliance Program. The program and dinner was to celebrate the 10 year anniversary of the FINRA/Wharton program and honor some of their more distinguished graduates. His topic, how securities experts work with compliance professionals and regulators. He was one of the very first graduates of the CRCP program, graduating in September 2001.

Schulz, a nationally known speakers along with such famous investment executives such as John Bogle of Vanguard. The conference was sponsored by the Delaware Securities Commission to help educate investors. Additionally, Mr. Schulz conducted a course for the Delaware Securities Commission’s regulatory investment team.

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Invest Securities Consulting in The News