On Friday, the Financial Industry Regulatory Authority (FINRA) awarded $1.4 milion to ex-Chicago Bulls star Horace Grant as compensation for losses the NBA star suffered as a result of investments in Regions Morgan Keegan bond funds. There are numerous lawsuits pending against the financial management company as a result of the funds, which investors allege were represented as low-risk, but which were actually tied to the volatile subprime mortgage market. When the market crashed, investors lost up to 80 percent of their investment, almost overnight.
FINRA is the money management industry’s regulatory organization, and is overseeing hundreds of arbitration complaints from investors.
Recently, Morgan Keegan made a surprising decision to appeal three of the arbitration judgments, which had been decided by FINRA in favor of the investors. Those cases are now tied up in further litigation. Other suits are still pending review.