Academic journal article Journal of Accountancy

Fiduciary Relationship Exists between Investor and Adviser

Academic journal article Journal of Accountancy

Fiduciary Relationship Exists between Investor and Adviser

Article excerpt

The fact that in some cases Deloitte dismissed negative information because it was outweighed by contrary information may have been bad judgment but did not sustain a securities fraud action.

The U.S. Court of Appeals for the Seventh Circuit ruled that an investment adviser owed a fiduciary duty to his client in giving investment advice.

Plaintiff Patricia Burdett retained Robert Miller, a CPA and a professor of accounting at North-western University, for advice on investing her substantial yearly income. She specifically wished to minimize taxes on the income. Miller advised her to invest in various tax shelters controlled by three of his acquaintances. He did not inform her these shelters were the group's first venture, the investment units would be unmarketable and her investment in two of the units represented one-third of the total investment in the project. Miller also didn't provide a prospectus or any other written information. All of the investments failed, and Burdett lost approximately $200,000. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.