What Does an Investment Fraud Lawyer Do?
Investment fraud lawyers recover money investors lost to broker or financial advisor misconduct. Most claims go through Financial Industry Regulatory Authority (FINRA) arbitration instead of court, and our firm handles them on a contingency fee. You owe no attorney fees unless we recover money for you.
Our investment fraud attorneys take claims nationwide and internationally from our Miami office. Call 305-728-3320 for a free case review.
Why Do Investors Bring Investment Fraud Claims to Erez Law?
Investors hire our firm because we handle one kind of case: claims against brokerage firms, stockbrokers, and financial advisors. Our attorneys have recovered more than $400 million for investors, drawing on more than 65 years of combined experience representing thousands of investors nationwide.
Founder Jeff Erez built the practice around securities arbitration and has tried cases to award in the FINRA forum. Clients rate the firm 4.9 stars.
Brokerage firms and their defense counsel read the name on the other side of a claim early. That single focus shapes how we staff a file, how we build damages, and how we prepare for a hearing.
A Firm Focused Entirely on Investment Fraud
Erez Law handles one type of case: investor claims against brokerage firms and financial advisors. This singular focus means every resource, every strategy, and every hour of preparation goes toward recovering investment losses. Our attorneys do not divide their attention across unrelated practice areas.
A Track Record Built in the Hearing Room
Our firm has recovered $400 million for investors with a 99% success rate. These results reflect an approach grounded in preparation, not volume. We have represented claims against some of the largest brokerage firms in the country, including Merrill Lynch, UBS, Morgan Stanley, Wells Fargo Advisors, and LPL Financial.
Trial-Ready from Day One
Every case is prepared as though it may proceed to a full hearing. That means aggressive, discovery-driven investigation from the outset: reviewing account records, identifying supervisory failures, building a damages model, and preparing for cross-examination. Brokerage firms and their defense counsel recognize when the opposing side is ready, and that recognition shapes settlement discussions.
Nationwide and International Representation
Our attorneys represent investors throughout the United States, Puerto Rico, and internationally, including clients across Latin America. We handle FINRA arbitration, AAA and JAMS proceedings, and state and federal litigation, choosing the forum that serves each client’s interests.
Contingency Fee Structure
Erez Law works on a contingency fee basis, meaning no attorney fees are owed unless we recover for you. Clients are responsible for case-related costs, and the contingency fee is calculated before deducting those costs. Every case begins with a free, confidential consultation.
Bilingual Support
Our team serves clients in English and Spanish. International investors may also reach us via WhatsApp at 305-336-8068 (text only).
How Does Investment Fraud Happen?
Investment fraud does not always look like a dramatic scheme. In many cases, it starts with a trusted advisor making recommendations that serve the broker’s interests rather than the client’s. The misconduct may be subtle at first, and losses can accumulate before the investor recognizes a pattern.
Unsuitable Investment Recommendations
Brokers and many financial advisors must follow rules that require recommendations to fit a client’s risk tolerance, goals, and time horizon, depending on the type of account and relationship.
A suitability claim arises when the advisor disregards these factors. For example, a retiree placed into high-risk speculative products or a conservative investor steered toward volatile alternative investments may both have grounds for recovery.
Churning and Excessive Trading
Churning occurs when a broker engages in frequent buying and selling primarily to generate commissions. The activity benefits the broker’s compensation while eroding the investor’s account value through transaction costs. Trading patterns, turnover ratios, and commission-to-equity ratios often reveal whether activity crossed the line from active management into excessive trading.
Unauthorized Trading
Trades made without the investor’s authorization, such as in a non-discretionary account or outside the scope of any trading authority, may constitute unauthorized trading. This includes transactions placed outside the scope of a limited trading authorization or in direct contradiction to the investor’s stated instructions.
Misrepresentation and Failure to Disclose
Brokers have an obligation to provide accurate, complete information about the investments they recommend. Misrepresentation occurs when material facts are distorted or omitted. Common examples include understating risk, overstating projected returns, or failing to disclose conflicts of interest, fees, or the illiquid nature of a product.
Overconcentration
A properly managed portfolio reflects diversification appropriate to the investor’s goals. Overconcentration occurs when a disproportionate share of the portfolio is allocated to a single security, sector, or product type, exposing the investor to avoidable risk.
Selling Away
Selling away occurs when a broker participates in a securities transaction outside the brokerage firm’s oversight, often involving investments not approved by the firm and not properly disclosed for firm review. These transactions may involve unregistered securities or private placements that bypass the firm’s compliance oversight, leaving the investor with limited protections.
Ponzi Scheme Losses
Ponzi schemes use funds from new investors to pay returns to earlier ones, creating the illusion of legitimate performance. When the scheme collapses, investors face devastating losses. Our investment fraud lawyers pursue recovery from the brokers, firms, and custodians who facilitated these schemes.
Many investment and security fraud cases we have handled include:
Which Investment Products Are Frequently Involved in Fraud Claims?
Certain investment products appear more frequently in fraud and misconduct claims than others. The complexity, illiquidity, or commission structure of these products may create incentives for brokers to recommend them regardless of suitability.
- Variable annuities: Complex insurance-based products with high fees, surrender charges, and tax implications that may be unsuitable for many investors, particularly seniors.
- Alternative investments and private placements: Illiquid, high-risk offerings often sold with limited disclosure. Investors may have difficulty accessing their funds or obtaining accurate valuations.
- Oil and gas investments: Tax-advantaged energy programs that frequently involve speculative risk and limited transparency. These products are a common source of claims from retirees and conservative investors.
- Hedge funds: Pooled investment vehicles with limited regulatory oversight and restricted redemption terms that may expose investors to undisclosed risks.
- Junk bonds: High-yield, high-risk debt instruments that may be marketed as income-producing without adequate disclosure of default risk.
The presence of these products in a portfolio does not automatically indicate fraud. However, when they were recommended without proper disclosure or to investors for whom they were unsuitable, a claim may exist.
Where Investment Fraud Claims Are Filed
Most investor disputes against brokerage firms proceed through FINRA arbitration rather than court. This is because brokerage account agreements almost universally include a pre-dispute arbitration clause.
FINRA Arbitration
The Financial Industry Regulatory Authority (FINRA) administers the primary dispute resolution forum for claims between investors and broker-dealers. Under FINRA Rule 12200, a member firm generally must arbitrate when a customer requests arbitration, and the dispute relates to the firm’s business or its registered representatives.
Our investment fraud lawyers at Erez Law have handled thousands of FINRA arbitration cases. We prepare every claim from day one as though it may proceed to a full hearing, because that level of preparation is what drives outcomes at every stage.
AAA and JAMS Arbitration
Claims against registered investment advisors or parties not subject to FINRA jurisdiction may proceed through the American Arbitration Association (AAA) or JAMS. These forums have their own procedural rules and fee structures. Our attorneys represent investors in all three arbitration forums.
State and Federal Courts
In limited circumstances, investment fraud claims may be pursued through litigation. Court may be appropriate when the claim involves parties outside FINRA’s jurisdiction, when statutory remedies are available, or when the arbitration clause is unenforceable.
Our firm evaluates each case to determine the appropriate forum for each case and advise our clients on their options.
Who Regulates the Broker or Firm That Handled Your Money?
Two bodies oversee nearly everyone who sells investments in the United States: FINRA and the Securities and Exchange Commission (SEC).
Which one governs your relationship depends on whether your account sat with a broker-dealer or with a registered investment advisor. That single fact decides where your claim gets filed and which rules the panel applies.
Investors rarely know which category their advisor falls into, because the business cards look identical. The table below sorts the terms that appear in almost every securities claim.
| Term | Meaning | How it affects your claim |
|---|---|---|
| Broker-dealer | A firm that buys and sells securities for customers and for its own account | Account agreements almost always require FINRA arbitration |
| Registered representative | The licensed person at a broker-dealer who handles your account, often called a stockbroker | The firm may bear responsibility for failing to supervise this person |
| Registered investment advisor | A firm or person paid a fee to advise on investments, owing a fiduciary duty | Claims often proceed outside FINRA, through other arbitration forums or court |
| FINRA | A self-regulatory body overseeing broker-dealers and their registered representatives | Runs the arbitration forum where most investor claims are heard |
| SEC | The federal agency overseeing securities markets, including investment advisors | Sets conduct standards such as Regulation Best Interest for retail recommendations |
Two accounts holding the same fund may follow two different legal paths based only on who held the account.
Our investment loss attorneys sort that question before drafting a statement of claim, because the wrong forum costs months. You can confirm how firms or people are registered through FINRA BrokerCheck.
Current Investment Fraud Investigations
Currently, the investment loss attorneys at Erez Law, PLLC are investigating a number of brokers, brokerages, hedge funds, and investment firms for their role in securities fraud and investment losses. Some of these include:
- Easterly ROCMuni Losses
- David Lerner Brokerage Firm
- Northstar Financial Services (Bermuda)
- Steepeners/Structured Products
- Conservation Easements
- GWG Holdings Inc.
- See All Current Investigations
The investment fraud attorneys of Erez Law have the depth, resources, and personnel that other securities fraud law firms – both large and small – don’t possess. Find out if you have a case against your broker by calling Erez Law or filling out our online contact form to get in touch. A dedicated investment fraud lawyer of our team will return your call and collect more information about your situation. Our consultations are always free, confidential, and protected by the attorney-client privilege.
How the Investment Fraud Attorneys at Erez Law Build Cases
Brokerage firms and their defense counsel evaluate the law firm on the other side of every claim. Investors represented by proven, trial-ready attorneys receive different treatment at the negotiation table and in the hearing room.
At Erez Law, our case-building approach reflects a “no stone unturned” methodology grounded in discovery, evidence, and preparation.
Account and Trading Analysis
Every case begins with a detailed review of account statements, trade confirmations, and transaction histories. This analysis identifies patterns of misconduct, quantifies losses, and establishes the factual foundation for the claim.
Discovery and Document Production
FINRA’s discovery process requires brokerage firms to produce account records, internal correspondence, compliance files, supervisory records, and communications related to the investor’s account. Our attorneys know which documents to request, how to interpret compliance files, and where to find the evidence that drives case value.
Damages Calculation
Quantifying investment losses requires financial analysis. The appropriate measure of damages may include net out-of-pocket losses, market-adjusted losses, well-managed account comparisons, fees and commissions paid, and interest. Our team works to present a clear, defensible damages model for each claim.
Hearing Preparation
Our attorneys prepare for hearings with the same rigor applied to trial preparation. This includes witness preparation, exhibit organization, opening and closing argument development, and cross-examination strategy. Brokerage firms and their counsel recognize when the other side is ready for a hearing, and that recognition influences settlement discussions.
Who Do Investment Fraud Lawyers Represent?
Erez Law represents a broad range of investors and entities affected by broker misconduct and securities fraud.
- Individual investors who lost money due to unsuitable recommendations, unauthorized trading, or misrepresentation
- Retirees and seniors whose retirement savings were placed in high-risk or inappropriate investments
- Trusts and estates managed by fiduciaries who failed to protect beneficiary interests
- Pension plans affected by advisor negligence or fraud
- Family partnerships and family offices with complex, multi-account relationships
- Ultra-high-net-worth individuals targeted for large-scale misconduct
- International investors harmed by U.S.-based brokers and brokerage firms
Our attorneys represent clients throughout the United States, Puerto Rico, and internationally, including investors in Latin America. Our team is equipped to handle claims in English and Spanish.
What Happens If the Brokerage Firm Offers a Settlement First?
Brokerage firms sometimes offer money before an investor files anything. Those offers arrive attached to a release, a document that ends every claim connected to the account. Signing one before the losses get calculated closes the matter permanently.
An early offer is not evidence of bad faith. It is evidence the firm has already assessed its own exposure.
What Does a Release Cover?
A release signed with a brokerage firm typically reaches past the single investment in dispute. It may cover the entire account relationship, every recommendation made during it, and any claim against the firm’s supervisors. Investors who read only the dollar figure miss that reach.
Does Declining an Early Offer End the Discussion?
Declining an early offer does not end the discussion. Firms that open with an offer rarely withdraw from negotiation afterward. Most FINRA claims resolve through settlement in any event, and filing a statement of claim frequently improves the numbers rather than hardening them.
Our investment fraud lawyers read any written offer at no cost before you respond. Call 305-728-3320.
FAQs for Investment Fraud Lawyers
Most FINRA arbitration cases close in a little over a year. FINRA’s own forum statistics put the overall turnaround near 14 months, with cases decided after a full hearing running longer, closer to 16 or 17 months. Roughly four out of five cases resolve by settlement or other means before a panel decides them, which shortens many timelines considerably.
No. FINRA arbitration is a national forum, and hearings get assigned to a location near the investor rather than near the lawyer. Our firm represents investors across the United States, Puerto Rico, and Latin America from our Miami office. What matters is securities arbitration experience, not a local address.
Our firm charges no attorney fee unless we recover money for you. The fee comes as a percentage of the recovery, and we calculate it before deducting case costs. Clients remain responsible for those costs, which include filing fees, expert analysis, and hearing expenses. We walk through the numbers in writing before you sign anything.
Yes. A broker leaving the industry does not release the brokerage firm from responsibility. Firms answer for failing to supervise their registered representatives, and that claim survives the broker’s departure or bar. FINRA also publishes the disciplinary record, which often strengthens the case.
Yes. A signature on account forms or a subscription agreement does not waive a claim when the broker misrepresented the product or omitted material facts. Panels look at what the investor actually understood at the time. Signed disclosures come up as a defense often, and they rarely end the analysis.
What Damages May Be Recovered in an Investment Fraud Case?
The damages available in an investment fraud claim depend on the facts of the case and the forum in which it is filed. Potential categories of recovery include the following.
- Net out-of-pocket losses: The difference between the amount invested and the amount recovered.
- Market-adjusted losses: Losses measured against what a properly managed portfolio might have earned during the same period.
- Fees and commissions: Excessive or undisclosed charges paid as a result of the misconduct.
- Interest: Pre-judgment or post-judgment interest on the losses sustained.
- Attorney fees and costs: In some cases, the arbitration panel may award attorney fees to the prevailing party.
- Punitive damages: Available in limited circumstances where the misconduct was particularly egregious.
A securities arbitration lawyer evaluates the facts of each case to determine which categories of damages apply and how to present them.
How Large Does an Investment Loss Need to Be to Support a Claim?
No fixed dollar figure decides whether an investment loss supports a claim. FINRA sorts cases into different procedural tracks by size, and the work a claim requires scales with it. A free case review sorts where your losses fall and which track applies.
Size shapes the process. It does not settle the merits.
Why Does Claim Size Change the Process?
FINRA sorts cases by dollar amount before anything else happens. Claims of $50,000 or less move through simplified arbitration and get decided on written submissions unless the investor requests a hearing. Claims above $100,000 go to a three-arbitrator panel under FINRA Rule 12401.
The three-arbitrator track is where full discovery, expert damages testimony, and cross-examination come into play. Those tools carry cost, and a claim has to support that cost to make use of them.
What Losses Count Toward the Total?
Total claim value includes more than the drop in account balance. Commissions and fees paid on the recommended products count. So do sales charges, surrender penalties, and the gap between your actual result and what a properly managed account might have earned.
Investors often undercount their own losses by looking only at the closing statement. Several accounts held at the same firm may combine into one claim, which sometimes moves a case into a different track on its own.
What Determines Whether a Claim Is Worth Pursuing?
Every investment fraud claim requires account analysis, damages modeling, and document discovery against the brokerage firm. Our attorneys weigh that work against what the records support before taking a case. Certain circumstances strengthen a claim regardless of size, including elder financial abuse and misconduct that touched multiple family or trust accounts.
We tell you during the consultation whether we are the right fit. Where we are not, we say so then rather than after.
Reach our investment fraud law firm at 305-728-3320 to have the numbers looked at.
How Do You Tell Investment Fraud From an Ordinary Market Loss?
Investment fraud shows in the gap between what a broker recommended and what the account paperwork says the investor wanted. Ordinary market losses hit portfolios that were built to fit. Losses from misconduct concentrate in positions that never matched the stated goals, risk tolerance, or time horizon.
Most investors sense the difference long before they prove it. The account records settle the question.
What Patterns Point Toward Broker Misconduct?
Certain patterns recur across the claims our investment fraud attorneys file. A portfolio that fell while comparable benchmarks rose is one. So is heavy trading that produced commissions without gains, or a single holding that grew to dominate the account. Products the investor never understood at purchase raise the same question.
Why Does Proving Investment Fraud Require the Account Statements?
Damages in a securities arbitration claim often get measured against the return a properly managed account produced over the same period. That figure comes from the statements, not from memory. Our investment loss attorneys run the comparison before telling anyone whether a claim exists.
Talk to Our Investment Fraud Lawyers Before Your Filing Window Narrows
Six years is the outer limit on FINRA eligibility, and the clock runs from the events behind the claim, not from the day you discovered them. FINRA Rule 12206 bars claims filed after that point. State and federal deadlines often run shorter.
That timing catches investors off guard more than any other rule in the forum. A broker recommended something in year one, the product held its stated value on paper through year four, and the loss only surfaced in year six. The paperwork looked fine the whole time.
Our securities arbitration lawyers read the account history against those deadlines first, before anything else. That review costs nothing and takes one conversation.
Call Erez Law at 305-728-3320. Our consultations stay free, confidential, and protected by attorney-client privilege.
Call 305-728-3320 or toll-free 888-840-1571 for a free, confidential case review. Hablamos Español. International clients may reach us via WhatsApp at 305-336-8068 (text only).