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To: TFF who wrote (10748)	4/4/2003 9:22:53 PM
From: eric012	Respond to of 12617

While it is interesting to see the term Fraud used in connection with those big firms, I'd like to see some commentary on the actual effect of the punitive damages being awarded in arbitration... For example (this is a real one) a small firm stole lots of money from a client. This firm was then bot by corp securities, then JWGenesis, then bot by FirstUnion, then by Wachovia. The arbitration hit at Wachovia. Client was awarded compensatory damages for money stolen from him, but also PUNITIVE damages, in the order of 16 Million. (!)Punitives are calculated against the net worth of a firm, and designed to be a hard slap on the wrist... But - when that kind of award is handed out in arbitration, what kind of a message is sent? I mean NONE of the people involved in the original crime were at Wachovia. With all of the frivolous lawsuits bubbling up, there couldn't have been a worse time for this sort of award. I wonder if brokerages are finding a hard time selling themeselves lately? With those kind of awards being handed out, sky may be the limit for liability. This market has to be creating consolidation - but who's buying?