Often their problems are compounded because they are sold inappropriate investments or insurance policies.

What is unclear is to what extent these teachers may be recommending inappropriate investments as part of the courses, as Mr. McCormick is accused of doing.

For investors able to show that the limited partnership was an inappropriate investment, he said arbitration could result in awards of 50 or 60 cents on each dollar invested.

But despite this strong showing, advisers to large institutions and pension funds say art is an inappropriate investment.

The proposal, which is among the harshest terms sought by any state regulator in settling the partnership scandal, would involve only customers for whom the partnerships were inappropriate investments.

A broker in the firm's Hong Kong office has been accused of selling inappropriate investments, and 10 investors have filed arbitration complaints against the firm.

Those practices include trading without client authorization, putting clients into inappropriate investments and other improprieties.

"In some cases in the 1980's, partnerships were inappropriate investments for some investors, and this settlement is a significant step toward equitably resolving this matter."

The S.E.C. found that more than half of the firms in the pension consulting business had conflicts that might lead them to recommend inappropriate investments.

Companies have so far resisted the argument that stocks are inappropriate investments for pension funds.