History of the PIABA Foundation

The PIABA Foundation was formed in 2012.  The PIABA Foundation’s mission is to promote investor literacy to consumers, in part, by providing educational materials that are designed to prevent investment abuse as well as to raise awareness about the investment-related securities arbitration dispute resolution process.

Simply put, most consumers are not financially literate and trust that their financial advisers are acting in their best interest. As a result, consumers commonly fall victim to investment abuse.  In many circumstances, investor losses are caused by bad investment advice and in some instances, outright financial fraud.  When this occurs, investors have a variety of legal claims that can help them successfully recover some or all of their losses.  Unfortunately, investors typically do not have the capability and/or investment knowledge to determine whether their losses are caused by malfeasance or whether they were simply a natural consequence of investing in the financial market.  As a result, the majority of investors do not know whether they might be able to recover their losses from advisers and/or their firms and many of these same individuals do not know that they may have legal recourse.  Statistics provided by Financial Industry Regulatory Authority (FINRA) Dispute Resolution, the organization that sponsors the arbitration forum handling virtually all disputes between financial firms/financial advisers and consumers, show that only 16,255 cases were filed by consumers between November 2007 and November 2010.  If you assume $6 trillion in stock market losses in 2008, these 16,255 cases amount to approximately one lawsuit for every $370 million in losses. These statistics illustrate that there is a real need for unbiased and helpful educational information. The PIABA Foundation is committed to helping consumers before investment abuse occurs.

The PIABA Foundation is a member of the Alliance For Investor Education (AIE) which is a national organization of large non-profit based in Washington D.C.  AIE is dedicated to facilitating greater understanding of investing, investments and the financial markets among current and prospective investors of all ages. The organization pursues initiatives for education and join with others to motivate Americans to obtain objective information and increase their knowledge and understanding of investing. Its membership includes:

AIE Members

American Association of Individual Investors The American Association of Individual Investors is a not-for-profit organization formed to assist individuals in becoming effective managers of their own assets through programs of education, information, and research.

Certified Financial Planner Board of Standards, Inc. Certified Financial Planner Board of Standards, Inc. (CFP Board) is non-profit organization based in Washington, D.C. that sets professional competency and ethics standards for personal financial planning. CFP Board owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER™ and federally registered CFP (with flame design) in the U.S., which it awards to individuals who successfully complete CFP Board’s initial and ongoing certification requirements. Founded in 1985, CFP Board’s mission is to benefit the public by granting the CFP® certification and upholding it as the recognized standard of excellence for personal financial planning.

CFA InstituteCFA Institute is the global, non-profit professional association that administers the Chartered Financial Analyst® curriculum and examination program worldwide. CFA Institute sets voluntary, ethics-based professional and performance-reporting standards for the investment industry.

Consumer ActionConsumer Action has been a champion of underrepresented consumers nationwide since 1971. A non-profit 501(c)(3) organization, Consumer Action focuses on consumer education that empowers low- and moderate-income and limited-English-speaking consumers to financially prosper. It also advocates for consumers in the media and before lawmakers to advance consumer rights and promote industry-wide change. By providing consumer education materials in multiple languages, a free national hotline, a comprehensive website (www.consumer-action.org) and annual surveys of financial and consumer services, Consumer Action helps consumers assert their rights in the marketplace and make financially savvy choices. Over 7,000 community and grassroots organizations benefit annually from its extensive outreach programs, training materials and support.

Financial Industry Regulatory AuthorityFINRA, the Financial Industry Regulation Authority, is the largest non-governmental regulator for all securities firms doing business with the U.S. public. Created in 2007 through the consolidation of NASD and NYSE Member Regulation, FINRA is dedicated to investor protection and market ingegrity through effective and efficient regulation and complementary compliance and technology-based services. FINRA touches virtually every aspect of the securities business – from registering and educating all industry participants to examining securities firms; writing and enforcing rules and the federal securities laws; informing and educating the investing public; providing trade reporting and other industry utilities, and administering the largest dispute resolution forum for investors and registered firms.

Investment Company Institute Education FoundationFormed in 1989, the ICI Education Foundation (ICIEF) is the educational affiliate of the Investment Company Institute, the national association of US investment companies. ICIEF partners with government agencies and other nonprofit organizations to develop, deliver, and promote investment education programs to a variety of specific audiences. The Foundation also participates in financial education advocacy coalitions, conferences, and initiatives that promote saving and investing nationwide.

Investor Protection TrustFounded in 1993 as part of a multi-state settlement to resolve charges of misconduct, the Investor Protection Trust serves as an independent source of noncommercial investor education materials to help equip investors, and would-be investors, with the armor they’ll need to protect them from sophisticated scams, and the knowledge they will need to better navigate their travel through the securities market.

National Endowment for Financial EducationA foundation partnering for the financial well-being of the public, the National Endowment for Financial Education® (NEFE®) evolved from and served as the parent entity of the Denver-based, non-profit College for Financial Planning, which was founded in 1972 as the nation’s first financial planning educational institution. NEFE is the only private, nonprofit foundation wholly dedicated to educating Americans about personal finance and empowering them to make positive and sound decisions in order to reach their financial goals. NEFE is completely non-partisan, unbiased and focused on consumer education, providing a crucial voice against the rapid rise in unchecked consumer spending and debt accumulation.

Securities Investor Protection CorporationWhen a brokerage firm is closed due to bankruptcy or other financial difficulties, the Securities Investor Protection Corporation steps in as quickly as possible and, within certain limits, works to return to you cash, stock and other securities you had at the firm. Without SIPC, investors at financially troubled brokerage firms might lose their securities or money forever or wait for years while their assets are tied up in court.


AIE Governmental Advisors

Commodity Futures Trading CommissionCongress created the Commodity Futures Trading Commission (CFTC) in 1974 as an independent agency with the mandate to regulate commodity futures and option markets in the United States. The mission of the CFTC is to protect market users and the public from fraud, manipulation, and abusive practices related to the sale of commodity and financial futures and options, and to foster open, competitive, and financially sound futures and option markets. Through effective oversight, the CFTC enables the futures markets to serve the important function of providing a means for price discovery and offsetting price risk.

Federal Reserve SystemBoard of Governors of the Federal Reserve System/The Federal Reserve System. The Federal Reserve System is the central bank of the United States. It was founded by Congress in 1913 to provide the nation with a safer, more flexible, and more stable monetary and financial system; over the years, its role in banking and the economy has expanded.

Federal Trade CommissionFTC/Bureau of Consumer Protection. The Federal Trade Commission is a law-enforcement agency mandated by Congress to protect the workings of a free marketplace. Its mission is to ensure that consumers can make sensible and unrestricted choices without distortion by misinformation, omission, or deception.

North American Securities Administrators AssociationOrganized in 1919, the North American Securities Administrators Association is the oldest international organization devoted to investor education and protection.

Securities and Exchange CommissionThe mission of the U.S. Securities and Exchange Commission (SEC) is to protect investors, maintain fair, orderly and efficient markets, and facilitate capital formation. The SEC’s Office of Investor Education and Advocacy implements a variety of initiatives aimed at equipping individuals with knowledge, skills, and tools to invest wisely and avoid fraud.