Depositor’s hoodwinked by Big Banks
We see them lining up at teller’s windows to make their deposits. Small deposits into low yield accounts for the backbone of America: working folk. But the “too big to fail” banks can stoop almost below the lowest of ethical windows….read this. FINRA had to implement a rule (Rule 3160) to stop tellers from diverting depositors to bank owned stock brokers haunting lobbies at bankers’ desks. Even I was surprised at this one! The rule goes somewhat (not far) to curb the abuse of tellers directing depositors into risky stock market investing to increase their yield. Bank depositors are risk avoiders and often unsophisticated. Preying on them in the inner sanctum of a conservative bank is bottom fishing raised to a new low. The rule only requires boilerplate risk disclosures. We need to return to the days when bankers banked and brokers broked instead of bankers diverting window depositors into inappropriate risk investments.