Is it true that the NASD has issued warnings to brokers that advise their clients to refinance their houses and invest the equity into securities?

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Is it true that the NASD has issued warnings to brokers that advise their clients to refinance their houses and invest the equity into securities?

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Yes, in March of 2004 the NASD issued a warning to all of its members. In essence, they warned against advisors recommending that their clients take equity out of their houses and invest it in securities. The Mead/Taylor Financial Group applauds the NASD for taking this position as many Financial Professionals were placing their clients in questionable investments. A close reading of the regulations does not prohibit a Financial Professional from; (a) investing money for a client when that client comes to them with their home equity, or (b) placing a clients funds in an investment wherein the principal is not subject to a downturn in the economy and the returns are guaranteed. To see a NASD response, click here.

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