Securities and Investment Fraud Cases
Have you lost money in your investments? This guide will help you determine what legal remedies are available to you to recoup your losses.
INTRO: Do I Have A Case?Many of my clients call me by chance after a brief read online that informs them that there are legal remedies for investor losses. If it weren't for doing an online search, they would have never thought of contacting an attorney to evaluate their potential investor claims. While online guides are a great tool for educating people on investment fraud, it is important to keep in mind that the best way to determine if you actually have a viable case is to consult a securities attorney.
The below steps will help you determine if you have a case, however, consult with an attorney even if you do not think the facts in your case completely match the information listed below. Following the steps below will help you get all the information together for when you consult with an attorney.
Step 1: Gather your investment statements and determine your losses.Best case scenario, you have a clear loss shown in your statements showing the difference between your principle amount invested and the ending balance. However, losses are not always that clear. Many of my clients have an ending balance that is higher than the principle amount invested, however, they still had a case against the investment firm because their broker's actions resulted in losses from the peak of their account value. In some cases, the statements show little to no loss in the principle amount, however, the broker made thousands off of trading fees while making no profits for the client.
Step 2: Gather any and all contracts and investment flyers or brochures.In many investment fraud cases, investors are sold on a single investment on which they lose money. Also, contracts will show what kind of investments you were expecting your broker to get you into (e.g. high vs low risk and yield). You should also look for an arbitration clause, which is usually a more cost-effective forum for hearing your case.
Step 3: Collect all correspondence with your broker.This includes emails, text messages, and any other documented communication. More often than not, investors were solicited by their broker and there are corresponding communications to show the solicitation and representations made to the investor.
Step 4: Call a securities and investment fraud attorney.While there are forums and other means available for investors to file a complaint against a broker, it would be wise to at least call and discuss with an attorney first. Generally, consultations are usually free in order to evaluate the strength of a case. Your best bet will be to retain an attorney who is experienced in recovering investor losses. Many attorneys will represent you for a contingency fee, which is a percentage of whatever they recover for you.
CONCLUSION: What Legal Remedies Are Available To Me?There are many avenues investors can take to recoup their investment losses. One of the most cost-effective methods in pursuing a legal remedy is through FINRA arbitration services. FINRA is the Financial Industry Regulatory Authority. They are a Self-Regulatory Organization (SRO). An SRO is not a government agency, however, they do create and enforce laws and regulations in the financial industry. Brokers and Dealers pay membership fees to FINRA, which includes the use of FINRA arbitration forums to resolve disputes. FINRA arbitration forums are usually held close to where the parties to the case reside. The arbitration is heard before a panel of arbitrators who are usually industry professionals.
While litigation is another legal remedy that may be sought by an investor, it is often times more costly and time consuming than arbitration. The litigation costs associated with depositions and drafting multiple motions don't apply to arbitration because it is a simplified litigation process. The steps to a FINRA arbitration are usually 1) filing a claim, 2) conducting discovery, 3) holding a mediation or other settlement process, and 4) attend an arbitration hearing (if the case is not settled).
Every case is different, and it is important to consider the advice of an attorney before taking any action against a broker. The aforementioned information in this article is a rough guide on what avenues may be available to investors. This article should not be understood to be legal advice. Following the information listed above should help you and an attorney efficiently evaluate your situation and pursue your interests accordingly.