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The law firm of Oakes & Fosher is presently investigating the alleged misconduct of securities broker Feisal Malik. According to his publicly available FINRA BrokerCheck report, Feisal Malik has been the subject of a FINRA sanction.

Feisal Malik is a Pennsylvania based securities broker. He has worked in the securities industry for twenty-six years. During his career, he has been registered with six different securities firms.

His Registrations

  • Pruco Securities Corporation (1991-1993)
  • The Prudential Insurance Company of America (1991-1993)
  • MML Investors Services (1994-2005)
  • NyLife Securities (2006-2007)
  • Signator Investors (2007-2016)
  • BestVest Investments (2017-Present)

The Allegations

Feisal Malik was officially sanctioned by FINRA in September 2016. The findings in this matter state that Malik circumvented his member firm’s procedures that prohibited its registered brokers from recommending equity-indexed annuities not approved by the firm. Feisal Malik allegedly sold approximately $1.3 million of unapproved equity-indexed annuities through an outside entity. Due to these alleged actions, he was fined $5,000 and suspended from acting as a securities broker in any fashion for a period of three months. He had already been terminated from his position at Signator Investments the previous January when the allegations first came to light.

What are Equity Indexed Annuities?

An annuity is an investment vehicle in which an investor pays scheduled premiums up until their retirement date–at which point they begin receiving scheduled distributions that act as their income during their retirement. A fixed annuity is pretty straight forward. Essentially, the amount that an investor receives in scheduled distributions during retirement is entirely determined by the amount they paid in premiums–plus interest. A variable annuity operates a little differently. The premiums paid by the investor are then invested into the equities market. The amount that the annuity holder receives during their retirement is entirely dependent on how well the invested premiums performed.

Equity-indexed annuities have properties of both fixed and variable annuities. The investor is guaranteed to receive the amount they paid into the annuity during their retirement. However, part of the interest that the premiums generate is invested into the equities market by mirroring a particular index like the S&P 500. The amount that an investor might see in returns is dependent on how the index performs over the life of the annuity. While this type of investment might seem favorable on paper, the reality is actually quite different. Equity-indexed annuities are some of the most illiquid securities plaguing the market today. Surrender fees for these products can be as high as 20 percent of what has been invested. That means the customer can lose 1/5th of what they have invested should the need to liquidate their annuity during its surrender period arise. Even if an investor believe they will never have to liquidate their annuity, the commissions that the broker receives when the transaction to purchase an EIA is executed are inordinately high and greatly diminishes the principal investment. These commissions so high that the investor seeing a return on their investment becomes almost impossible under anything other than exceptional market conditions.

Oakes & Fosher Can Help

Many investors are unaware of the legal recourse available to them after losing money due to securities broker fraud and/or negligence. The truth is that investors who have lost money in this fashion may actually be entitled to damages.

Oakes & Fosher dedicates its entire legal practice to helping investors across the nation. If you, or someone you know, have lost money investing with Feisal Malik, please contact Oakes & Fosher for a free and private consultation.