The study on "How Widespread and Predictable is Stock Broker Misconduct?" by SLCG, past customer complaints against individual brokers can serve as predictors of future complaints. McCann, Qin, and Yan's research shows that incorporating the complaint histories of co-workers greatly enhances the ability to predict complaints against brokers with no previous complaints. They also established that customer complaints that were denied, rather than just settlements and awards, are valuable for anticipating future investor harm.

Egan, Matvos, and Seru's research underscores that, rather than eliminating underperforming brokers from the industry, the regulatory environment and labor market tend to funnel these brokers towards firms that hire individuals with disproportionately high numbers of customer complaints. These firms typically maintain loose hiring criteria and exhibit lenient compliance standards, specializing in exploiting inexperienced investors.

In their related study, Dimmock et al. [2016] establish that financial fraud spreads contagiously. They find that a broker's inclination to commit financial fraud is significantly shaped by the tendency of their coworkers to engage in fraudulent activities, even when accounting for firm culture, branch dynamics, market conditions, and state regulatory frameworks.

Ariana Nicole Figuerass current employer, is one of the 30 highest risk brokerage firms measured by the percent of brokers at the firm who have customer complaints disclosed on their BrokerCheck reports. 19.17% of 's brokers have customer complaints compared to only 2.71% of all brokers who have complaints.

If you have questions about this post, about and/or Ariana Nicole Figueras or about the management of your accounts, please contact SLCG for an initial consultation or email us at BrokerInquiry@SLCG.com.

SLCG Economic Consulting, LLC

For nearly 25 years, SLCG Economic Consulting, LLC ("SLCG") has provided consulting services to individuals, corporations and state and federal agencies mostly related to finance and economics. SLCG professionals include professionals with substantial academic and government experiences who conduct ongoing publishable research.

SLCG is a wholly owned subsidiary of McCann Yan Holdings, Inc., a Virginia incorporated company based in Northern Virginia.