Many people hire stockbrokers, financial advisors, and brokerage firms to provide investment advice and assistance growing their wealth. Unfortunately, some brokers and brokerages do not adhere to their duties and instead attempt to line their pockets at their clients’ expense. If you’ve lost money because of a broker’s fraudulent behavior, a Pennsylvania stockbroker fraud attorney from Erez Law, PLLC, can help you demand compensation for your losses.
For more than 20 years, our securities law firm has advocated for the rights and interests of victims of stockbroker fraud. We focus exclusively on helping investors who have lost money because of fraudulent behavior and misconduct. This has given us the experience and resources it takes to fight even the biggest names on Wall Street. Our track record of success is reflected in the more than $175 million we have recovered for our clients throughout Pennsylvania, the United States, and around the world.
If you suspect that misconduct has led to your investment losses, reach out to Erez Law, PLLC, for a free case evaluation with a Pennsylvania stockbroker fraud attorney. We will discuss your legal options for pursuing financial recovery of your losses. There is never a charge unless we secure compensation for you.
What Is Considered Stockbroker Fraud?
There is always a risk of losing money on investments. Although this usually occurs due to normal market forces, in some cases, these losses may be due to fraudulent behavior on the part of a stockbroker or financial advisor. Brokers are expected to develop an investment strategy based on a client’s financial situation, risk tolerance, and goals. If they make investment decisions that do not reasonably serve the client’s investment strategy and preferences, or that benefit the broker or the broker’s firm to the detriment of the client, they could be committing fraud. When this fraud costs a client money, the broker or brokerage firm could be held both criminally and civilly liable.
What Are the Signs of Stock Fraud?
Common signs that your stockbroker or brokerage firm may be engaged in misconduct or fraudulent behavior include:
- Your account statements make no sense to you, or they reflect transactions that you did not authorize and have no knowledge of.
- You are losing money despite the broader market continuing to rise across sectors.
- You suffer a steep drop in the value of investments in a short period of time.
- Your broker regularly recommends investments that lose money.
- Your broker fails to disclose material information about a prospective investment or strategy.
- Your broker starts placing your money in high-risk or speculative investments when you have not authorized such a strategy.
- The investments your broker has selected for you regularly have financial results below their publicly announced expectations.
- Your broker stops responding to your calls or emails.
Although these signs don’t necessarily mean that fraud has occurred, you should speak to a Pennsylvania stockbroker fraud attorney about any suspicious behavior or transactions that lead to losses. The sooner you bring potentially fraud-related investment losses to an attorney’s attention, the greater your chances of recovering some or all of those losses.
Common Types of Stockbroker Fraud
A wide range of behaviors can constitute stockbroker fraud, such as:
- Excessive trading, usually performed to generate fees for the broker rather than to serve the client’s interests
- Selling away, or liquidating investments when not approved by the client
- Unauthorized trading, which may occur when a broker is required to obtain client authorization for all trades
- Unsuitable investments for a client’s objectives or financial situation
- Lack of diversification, as a reasonable investment strategy usually involves investing in different sectors to defray risk
- Excessive use of margin, which can make the client liable to pay back margin funds when the value of investments declines
- Misrepresentation or omission of the risks of a prospective investment or strategy
- Churning, or the practice of investing on behalf of a client for the purpose of generating commissions rather than serving the client’s interests or investment objectives
- Pump and dump schemes, in which the value of an investment is inflated by fraudulent representation to unsuspecting investors who purchase the investment, allowing the scheme organizers to sell their stakes at a profit before the investment’s value ultimately collapses
- Unregistered securities sales, including investing client money in new, speculative, high-risk startups without adequately advising the client as to the risk
- Failure to execute trades, especially when a trade is ordered or authorized by the client
- Failure to supervise, or a brokerage firm’s failure to oversee the activities of the individual brokers at the firm
- Misleading or incomplete disclosures involving prospective investments being recommended by your broker
- Misappropriation, or taking a client’s assets or funds for the broker’s or firm’s own benefit
- Overconcentration, or placing too large a portion of an investment portfolio into a single investment or sector
- Breach of fiduciary duty, which refers to brokers’ and brokerage firms’ duty to act reasonably and in good faith on behalf of their clients, placing those clients’ interests over their own
- Broker negligence, or failure to act in the way that any reasonably prudent broker would
- Violation of state and federal regulations or the regulations of FINRA and other voluntary regulatory associations
How Our Pennsylvania Stockbroker Fraud Attorney Can Help You
When you have suffered investment losses due to fraud, turn to a Pennsylvania stockbroker fraud attorney from Erez Law, PLLC. We can help by:
- Investigating your case to find evidence of your broker’s fraud or misconduct, such as account statements, market analysis, and other financial records
- Calculating your financial losses from your broker’s misconduct, obtaining expert opinions as needed to prove that you were defrauded by your broker, and establishing the extent of the losses that you have incurred
- Explaining your rights and options for pursuing financial recovery and justice from your broker, such as by filing a legal claim or lawsuit, or by filing a complaint with state, federal, and/or FINRA regulators
- Fighting for your rights every step of the way to demand the maximum compensation you deserve for your losses
Our attorneys are always here to answer your questions if you suspect you have been the victim of stockbroker fraud. Contact our securities fraud law firm now for a free and confidential consultation. There is no charge for our legal services unless we secure compensation for you.
Time Limits for Taking Action in a Stockbroker Fraud Case
Under Pennsylvania law and federal securities law, a defrauded investor has a limited amount of time to file a lawsuit seeking financial compensation. The Financial Industry Regulatory Authority (FINRA) also places strict time limits on how long investors have to file a fraud claim.
Because time is of the essence in pursuing compensation, you need to speak to a Pennsylvania stockbroker fraud attorney as soon as you have suspicions about an investment loss. At Erez Law, PLLC, we will investigate your stock market fraud case thoroughly and explain your legal options for pursuing the recovery you deserve.
Talk to a Pennsylvania Stock Fraud Lawyer Now
If you have been the victim of broker fraud, don’t wait to get legal advice. Contact Erez Law, PLLC, today for a free and confidential consultation with a Pennsylvania stockbroker fraud lawyer. We work with investors in Philadelphia, Pittsburgh, Allentown, and across the state. Our firm exclusively handles investment fraud cases, and we are ready to put our experience to work for you.