Practice Areas
Practice Areas
We handle many types of investor misconduct claims, but these are the most common claims we see. We are not limited to practicing in these areas, so if you don’t see a practice area that relates to your unique situation, please reach out to us so we can discuss your claim.
Asset Allocation
Asset allocation and proper diversification are essential for a healthy and growing investment portfolio, and a failure to properly allocate assets into various classes and instruments can lead to the value of entire portfolios being destroyed. To determine if your assets were allocated irresponsibly or inappropriately for your risk tolerance, reach out to an arbitration expert with the details of your suspicions.
Breach of Fiduciary Duty
Your financial professional, such as your broker or financial advisor, if registered with FINRA, is your fiduciary. This means they are tasked with acting in your best interests concerning your account and investments, at all times. This isn’t just an ethical obligation, it is also a legal one.
Churning
Churning is also known as “excessive trading” and occurs most frequently in brokerages or firms that still charge fees and commissions on a per-trade basis. Churning is a fraud and is one of the many ways in which a broker or financial advisor breaches the fiduciary duty they owe to their client or customer. Churning is when a broker will make excessive trades, sometimes even buying and selling the same stock over and over, to generate more fees and commissions for themselves.
Failure to Execute
Failure to Execute claims is rarer, but they do happen. A Failure to Execute is where your broker or agent fails to execute an order you submit or a request you make, within a reasonable amount of time. In the markets, time is of the essence, and failing to execute an order promptly can result in devastating losses. Brokers are bound to execute orders they receive within a reasonable amount of time, and in some cases, like failing to execute closing a short position, it can even be illegal. If orders are purposely ignored, there may even be a valid claim for punitive damages.
Failure To Supervise
There are rules and regulations set forth both by the New York Stock Exchange, as well as by FINRA, which govern the conduct of brokerages and investment firms. Many of these regulations specify how firms and brokerages need to supervise their brokers and advisors. They mandate that an advisor or broker must become familiar with their customer, so that they can more fully understand their investment goals, and can avoid potential claims of unsuitability. Working with an attorney gives you a much better chance of challenging the FINRA compliance of the brokerage.
Negligence Claims
Claims of negligence are based on a failure to act as another “reasonable or prudent” broker would. There are many potential acts or failures to act that could be classified as negligent and it’s impossible to cover them all. Negligence is not as severe as willful misconduct, which constitutes all fraudulent activity, and is less serious. That said, negligence can still create devastating losses.
Ponzi Schemes
Ponzi schemes are outright fraud and are often conducted in conjunction with other types of fraud or illegal activity. Ponzi schemes are where the fraudster courts investors, then use the money from their investment as the “returns” for the previous generation of investors, continuing to seek more and more investors, shifting money from one place to another.
Unauthorized Trading
Unauthorized trading is a serious concern and one that FINRA places heavy penalties on. Unauthorized trading is any trading transactions or orders that are executed without the express consent of the investor or account owner. Unless prior consent has been given, trading on behalf of an investor is strictly prohibited.
Failure to Execute
Claims of unsuitability are some of the most common in investment fraud. Since your financial professional owes you a duty of care, they have not only an ethical but a legal obligation to make sure their recommendations fit your investment goals.