The New York state attorney general announced the Securities Industry Association will lead a $500,000 campaign to educate investors about online stock trading. The announcement follows a nine-month investigation by the attorney general's office, which questioned online brokers' ads. The probe was prompted by consumer complaints regarding slowdowns and outages among broker Web sites due to explosive growth. In a report released today, the attorney general concluded that, while most of the technical problems have been resolved, ads need to inform consumers better about the risks and capabilities of online trading. "If you were to believe all the online [brokerage] advertising today, you would get the impression that investors have access to both instant trades and instant wealth, neither of which is true," said Attorney General Eliot Spitzer's statement. A spokeswoman for the Securities Industry Association said the trade group was called in because it has experience with investor education programs, but it was too soon to say how this campaign will be executed. She said SIA will form an ad hoc committee soon to oversee the effort.
Copyright November 1999, Crain Communications Inc.