Investor beware

A recent academic study finds that 7 percent of financial advisers have misconduct records. Most manage to keep working in the industry. The report by Mark Egan of the University of Minnesota and Amit Seru and Gregor Matvos of the University of Chicago finds evidence that rogue advisers pay a price. More than half lose their jobs, and consumers collect a median $40,000 when firms settle misconduct cases.

But the study finds that “the labor market partially undoes’’ the discipline: 44 percent of those who lose their jobs find work in financial services within a year — though they accept a 10 percent drop in pay and tend to move to “less reputable’’ firms. In fact, the researchers find, some firms seem to “specialize’’ in targeting poorly educated, elderly people.

The Securities Industry and Financial Markets Association, which represents banks and investment firms, calls the findings “overly broad and inflated.’’ One complaint: The study counts every settlement as an example of misconduct.

SIFMA argues that firms sometimes settle to save time and money or for other reasons “having nothing to do with alleged ‘misconduct.’”

Where the rogues are Financial advisers with records of misconduct — and the firms that employ them — are especially attracted to places with “low education, elderly populations, and high incomes.’’