Charles Schwab Loses Another YieldPlus Arbitration

Charles Schwab has been trying most of the many arbitration cases filed against it related to the Charles Schwab HighYield Plus fund. Last month, a Los Angeles based Finra panel awarded what appears to be almost 100% of an investor’s losses (about $75,000) in the fund, plus expert witness fees and all of the arbitrators compensation. The case is Chang v. Charles Schwab (Finra case number 08-02417) and is available on Finra’s website. This is one of a string of recent losses in the HighYield Plus fund cases based upon allegations that the fund was overconcentrated in mortgage backed securities. It will be interesting to see if Schwab starts settling more of these cases.

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