Protecting Your Money by Responding to Stockbroker Fraud

Part 3: Reacting and Responding to Stockbroker Fraud

Protecting Your Money by Responding to Stockbroker Fraud 

In Part 1 of this series, we identified a sampling of types of stockbroker fraud. In Part 2, we discussed ways to avoid becoming the victim of an investment scam or stockbroker fraud. In our final post, we discuss what to do if your preventative measures fail to keep you from falling prey to a stockbroker’s unscrupulous behavior. You can protect your money

Dealing with Stockbroker Fraud

There are several actions that can be undertaken after uncovering fraud, and some things that should be done to recover the money you’ve lost as a result of stockbroker fraud.

Call a Stockbroker Fraud Lawyer

If you think you have been someone’s prey in an investment fraud scheme, contacting a qualified investment fraud attorney first can be one the smartest and most important thing to do. Fraud, like many other illegal activities, has a statute of limitations. You need to make sure you protect your rights within the timeframe specified by the law or you could forfeit your right to recover anything, no matter how guilty the perpetrator is. An experienced stockbroker fraud lawyer should be able to review your case and provide you with advice on how to proceed.

Escalate Your Complaint to a Higher Level

If you are dealing with an individual stockbroker, you also can contact the broker’s supervisor to express that you believe the broker might have engaged in misconduct. If the supervisor doesn’t help, or will not help, which often is the case, you should immediately contact an investment fraud lawyer.

Importantly, even if the supervisor represents that they will investigate your claims, you still should contact a stockbroker misconduct lawyer. To avoid getting sued, many brokerage firms will not disclose to an investor that they believe that the broker did something wrong. An independent analysis of your claims by an experienced investment fraud lawyer likely will give you the most accurate opinion of the nature and extent of misconduct that has been committed.

File an Arbitration Claim or Lawsuit

Suing the brokerage firm may not be the first thing that should be done, but it often is the only means of recovering investment losses. Brokerage firms rarely offer to pay investors for investment losses if the investor has not forced the brokerage firm’s hand by filing a FINRA arbitration claim or lawsuit against the brokerage firm. [Note: Most brokerage firms require that disputes with investors be filed through FINRA’s arbitration system rather than through the court system.]

An Attorney May be Best at Responding to Stockbroker Fraud

This brings us back to our first tip, which is consulting an experienced investment fraud lawyer: an attorney can help you identify the nature and extent of the wrongdoing and the strengths in your case, and advise you on the best way to proceed. An experienced stockbroker fraud attorney can help you navigate the FINRA arbitration system.

Most stockbroker fraud lawyers work on a contingency-fee basis, which means that they only get paid when and if they help you recover money. Their fee typically is a percentage of the money that they recover for you.

Call a Stockbroker Fraud Attorney Today

If you have suffered a loss because your broker or brokerage firm misrepresented or omitted crucial information before you invested, you may have legal rights that require your immediate attention.

Contact an attorney today to schedule an appointment or consultation to review your rights and options.

Avoiding Stockbroker Fraud is the best way to protect your money.

Part 2: Identifying and Avoiding Stockbroker Fraud

Protect Your Money by Avoiding Stockbroker Fraud

In the first blog post in our blog series, we discussed the basics of what a stockbroker does and some examples of ways in which one can be victimized by an unscrupulous stockbroker. As we mentioned before, the types of stockbroker fraud we mentioned are not comprehensive. Rather, our blog is meant to demonstrate that there are numerous forms of stockbroker fraud. When in doubt, consult a qualified professional.

Now that you know to be on the lookout for potential stockbroker fraud, spotting it is not always as it easy as it may seem. A stockbroker intent on committing fraud often can disguise their misconduct through artful and convincing sales pitches. A Ponzi schemer, for example, has a goal of luring you away from your money by promising something otherwise unattainable, like extremely high rates of return. Many Ponzi schemers have defrauded even savvy investors out of millions – and even billions – of dollars.

4 Steps to Avoiding Stockbroker Fraud

There is no sure-fire way to detect stockbroker fraud, but the following tips can help you make sure that you and your money are being treated both fairly and legally:

  • Ask questions. Gather as much information as you can – if you don’t like or understand the answers, ask for clarification or seek another opinion. Stockbrokers are obligated to disclose not only the upside of investments but also the risks.
  • Get a second opinion. While brokers earn a living based on sales of stocks and other securities, any broker worth their reputation should not be afraid to let you perform your due diligence before investing. If you feel pressured to make an immediate decision, it may be because the person selling to you might not want you to uncover whatever it is he or she is trying to hide.
  • Do your homework. There are many ways to gather information, and you should use every means at your disposal. The Financial Industry Regulatory Authority (FINRA) has an excellent BrokerCheck tool where you can see if your broker or the firm has ever been accused of any wrongdoing.
  • When in doubt, consult a lawyer. If you are worried that something just doesn’t add up, or even if you just have questions, consult a qualified securities attorney who can help make sure that your account is accurate, and your investments are legitimate – and legal.

Even a savvy, experienced investor who has done their homework is not 100% safe from investment fraud; however, by following the steps outlined above, you can give yourself a chance to avoid being victimized.

Stay tuned for our final installment in our stockbroker fraud series in which we discuss what to do in the unfortunate event that you become the victim of stockbroker fraud.

Call a Stockbroker Fraud Attorney Today

If you have suffered a loss due to stockbroker fraud, you may have legal rights that require your immediate attention.
Contact an attorney today to schedule an appointment or consultation to review your rights and options.