What is account churning? Account churning is when a financial advisor engages in the repeated purchase and sale of investments such as stocks and mutual funds for the sole purpose of generating sales commissions. Churning activity in an investment account can deplete an account’s value due to the payment of excessive commissions, and even margin interest for accounts carrying margin features.
Unsuspecting investors can be tricked into thinking that churning-type activity is a legitimate trading strategy, when in fact it is not. If you feel your account has been excessively traded through churning-type activity resulting in financial harm, we welcome you for a free initial consultation for an assessment of your matter.