LEGAL GUIDE
Written by attorney Debra G. Speyer | Jul 12, 2011

Common Investment Pitfalls: Misrepresentation

Misrepresentation can occur when a broker purposefully makes untrue representations of material facts or omits material information regarding a potential investment.

As detailed by FINRA, here’s what you need to know to protect yourself and your money:

  • Ask the broker to send you information that will back up his/her representations.
  • If you rely on your broker, make sure the investment meets your objectives; and make sure you understand and are comfortable with the risk, costs and liquidity of the investment. Never invest in a product you don’t understand.
  • Ideally, you should independently verify information by thoroughly reading a prospectus, research reports, offering materials, annual reports (10K), quarterly reports (10Q), brochures or other documentation.
  • Keep contemporaneous notes of your conversations with the broker.

If you discover information that does not coincide with a representation made by the broker, it is important to immediately raise your concerns to the broker as well as the firm’s management or compliance department. If you suspect you have been the victim of fraud or misrepresentation, it is imperative to consult with an experienced securities fraud attorney.

Additional resources provided by the author

At Wall Street Fraud, we are dedicated to offering assistance to those who have been hurt by improper corporate or investment practices. If you have been the victim of stock brokerage fraud, securities fraud, mutual fund fraud, stockbroker fraud, annuities fraud, or any other type of investment fraud, please contact us today for a free case evaluation. Our talented and aggressive legal and professional staff is eager to help you recover your losses.

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