Given the increasing popularity of online brokerage firms, the fact th

Given the increasing popularity of online brokerage firms, the fact that these firms have started to offer their clients other financial services is hardly surprising. In some cases, customers can simply link their online stock portfolios with traditional accounts held by other financial institutions. More and more online brokers, however, offer their own interest-bearing checking accounts, money market accounts, and retirement accounts, and even provide mortgages and home equity loans.

Some investors are understandably attracted to the idea of a one-stop shop for all their financial needs, and indeed there are conveniences to having one’s various asset accounts linked together. But consumer advocates point out that this convenience extends to criminals intent on gaining access to funds and financial data. As Francis Golsen of the Investor Protection Bureau points out, “Combining your assets at one financial institution is a bit like using your parked car to store your jewelry. If you become a victim of theft, there’s that much more to thieve.”

Another danger is that investors may be less selective when deciding which financial institution to use for various services, given that the easiest choice is to use one company for every service. The temptation not to shop around may lead to a hasty decision. This fact is not lost on brokerage firms, whose marketing departments are quick to take advantage of the cross-selling potential inherent in offering so many products. As a result, those who use one-stop banking should expect an increase in promotional material clogging their email inboxes.

To be fair, we are now seeing some very attractive products as more brokers get into the act of providing additional services. Some firms are offering checking accounts with interest rates so high that these accounts are most likely “loss leaders” designed to get investors interested in other financial products offered by the firm. But this can only last so long. No investor should assume that their beloved brokerage house, which now advertises free trading and checking accounts with interest rates of 3.9% (and no minimum balance required!) will continue to provide these offers a month after they were first made.

1. Which of the following is NOT mentioned in the passage as a possible negative result of “one-stop” banking?

(A) The potential for criminal wrongdoing is heightened.
(B) Investors may not sufficiently explore their options.
(C) Investors may receive unwanted marketing offers.
(D) Brokerage firms may lack sufficient expertise in managing other
financial services such as mortgages and home equity loans.
(E) Investors may wrongly assume that certain introductory offers are still in place.



2. The primary purpose of the passage is to _______.

(A) alert readers to certain risks associated with using “one-stop” shopping for financial needs
(B) give examples of the ways in which online brokers have diversified their services
(C) raise questions about the legitimacy of cross-selling financial services
(D) advise investors not to link traditional bank accounts with online accounts
(E) provide an overview of recent changes in online brokering



3. It can be inferred from the passage that the increase in the number of online brokers who offer banking services _______.

(A) was a result of consumer dissatisfaction with the level of service offered by traditional banks
(B) could come to an abrupt end without much warning
(C) has led to some financial products that appear to be very desirable to investors
(D) has contributed to an increase in the number of crimes involving the theft of financial data
(E) is, despite some risks, generally beneficial to investors who want to diversify their stock portfolios



4. The purpose of the second paragraph is to make which of the following points?

(A) Linking many of one’s financial assets is risky and no more convenient than keeping one’s banking and online portfolios separate.
(B) One-stop banking puts investors at risk for more than just theft of assets and financial data.
(C) Using one firm for many financial services puts one at a greater risk of theft than using several institutions does.
(D) Investors who use their online broker for diverse banking services risk making hasty financial decisions.
(E) Traditional banking services such as mortgages are best provided by traditional banks.