I'm a broker and recently quit my firm and moved to another broker-dealer. I am of a certain nationality. I learned that, after I left, my former branch manager met with one of my clients who is of a different race/religion/nationality than me. My former branch manager, in an apparent effort to keep the client from moving with me, told the client that he would put him with a broker in the office of the same nationality as the client. Could this constitute affinity fraud?
While this does seem like an underhanded way to try and keep a client, it doesn't really rise to the level of "affinity fraud". The SEC explains that "affinity fraud" generally refers to investment scams that prey upon members of identifiable groups, such as religious or ethnic communities, the elderly, or professional groups. The fraudsters who promote affinity scams frequently are - or pretend to be - members of the group. These scams exploit the trust and friendship that exist in groups of people who have something in common.
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