Mass. Regulators Say RBC Improperly Sold Risky ETFs

Law360, New York (July 21, 2011, 4:04 PM EDT) -- Massachusetts securities regulators on Wednesday accused RBC Capital Markets LLC and a former representative of selling complex exchange-traded funds to clients who did not understand the products or their associated risks.

The Canadian investment bank and former sales representative Michael D. Zukowski made leveraged, inverse and inverse-leveraged ETFs available to investors without providing them with an understanding of how they functioned or how long they should be held, the Massachusetts Securities Division alleges in an administrative complaint.

"Many investors have been surprised and disappointed when certain...
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