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Can you sue investment firms for allowing a forged TOD to be validated although they have signature cards to compare signatures

Cicero, NY |

My aunts signature was forged on three investment firms TOD agreement forms, David Lerner, Dreyfus, and NFB Investment Services Corp. Each firm approved the documents even though my aunt was in the hospital dying of lung cancer and in a coma when one of the agreements was signed. I have the medical records to prove it. The signatures are forgeries for sure. Can these investment firms be sued.

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Attorney answers 3


Investment firms have a "know your customer" rule, and an obligation to perform due diligence. Unfortunately, many firms ignore this rule. If damage has resulted from this forgery, then you may have viable claims. You should consult with an attorney familiar with investment fraud. The federal securities statutes provide relatively short statute of limitations, so you should do so promptly.

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These issues present difficult cases, insofar as you will need to prove that the broker/dealer had a specimen signature on hand (in an account opening document) and checked to make sure it was legitimate. In many cases, a TOD form requires a "signature guarantee" or some other affirmation. Further, each firm likely has differing supervisory and operational procedures on the handling of such forms, verification, etc. A securities litigator should be able to assist you in evaluating the case further and whether you're looking at filing a Statement of Claim with FINRA or trying to negotiate a settlement. Whatever you do, do not try to prosecute a FINRA arbitration claim on your own. The rules are somewhat different from court, and someone with experience in FINRA arbitration will be able to handle the peculiarities of the pleading and discovery processes.

The foregoing is not legal advice nor is it in any manner whatsoever meant to create or impute an attorney/client relationship.


When the document in question is hand written, there is high chances that handwriting expert can be used to determine the extent of the forgery. There are some differences when it comes to handwritings of different persons thus making it possible to be differentiated by someone who is keen enough.
Forensic evidence which include fingerprints may also be used to determine whoever is responsible for a forgery. There are so many instances of altered signatures which have the intention to deceive completely.Eligible Cases
Arbitration cases are eligible to be heard in FINRA's forum if the following criteria are met:
For disputes with investors:
The cases involve an investor and an individual or entity registered with FINRA, such as cases between investors and brokers, between investors and brokerage firms, and between investors and brokers and brokerage firms; and
The claim is filed within 6 years from the time the events giving rise to the dispute occurred.
For disputes involving industry parties only:
The cases involve an individual or entity registered with FINRA, such as cases between brokerage firms, between brokers, and between or among brokerage firms and brokers; and
The claim is filed within 6 years from the time the events giving rise to the dispute occurred.
Required Investor Arbitration An investor must arbitrate at FINRA if:
The arbitration is required by written agreement;
The dispute is with a member of FINRA, which could be a broker and/or brokerage firm; and
The dispute involves the securities business of the broker and/or brokerage firm.
Required Industry Arbitration
A broker or a brokerage firm must arbitrate at FINRA if:
The dispute arises out of the securities business activities of a broker and/or a brokerage firm; and
The dispute is between or among the following members of FINRA: brokerage firms, brokerage firms and brokers, or brokers.

If an investor requests arbitration, a broker or a brokerage firm must arbitrate at FINRA.

Exception to required industry arbitration:

If you are a broker and your dispute involves an issue of employment discrimination, including sexual harassment, the dispute is not required to be arbitrated unless the parties agreed to arbitrate it, either before or after the issue arose.
Resolution and Results The resolution of arbitration cases vary. Some are decided by the arbitrators; others are resolved by settlement of the parties or through mediation. In a significant number of cases, investors receive monetary or non-monetary relief, either from an award rendered by the panel or a settlement of the parties. For more information on how cases close and how often customers are awarded damages, view our dispute resolution statistics.
Legal Representation You should consider hiring an attorney to represent you during the arbitration proceedings to provide direction and advice. Even if you do not choose to hire an attorney, the other parties may have counsel. Generally, brokerage firms are represented by an attorney. If you cannot afford an attorney, some law schools provide legal representation through securities arbitration clinics. For more information, view our section on how to find legal representation.
Arbitration Process View our arbitration process section for a description of the steps required to complete an arbitration.

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