Cleveland, Ohio Stockbroker Fraud AttorneyStockbroker Fraud. We can recover your money. Our Recent Results:
Call Stockbroker Fraud Attorney - Craig Weintraub 216-896-9090Stockbroker Fraud includes:Churning
Churning is probably the most example of stockbroker fraud. A broker who trades to solely generate commissions engages in churning. Brokers will liquidate holdings at a small profit to cover the commission. An investor will be contacted by the broker and will be asked to engage in repeated trading. An investor must show that (1) the broker controlled the account; (2) the trading was excessive in light of the investor’s objectives; and (3) the broker acted with the intent to benefit himself through the generation of commissions and to the detriment of the investor. We are required to prove that the trading patterns were without merit and generally excessive.
Breach of Fiduciary DutyBrokers are fiduciaries in relation to their client. The broker is in a position of trust and confidence, owing the highest degree of loyalty and fidelity to investors. If a broker breaches this duty to an investor, a claim may be pursued, usually in conjunction with or overlapping another type of claim. This is the broadest of categories of broker violations. Brokers are expected to conduct due diligence on the companies he or she recommends, charge commissions that are fair and reasonable, understand and observe the financial needs of an investor. In addition, brokers are expected to take appropriate action to cut losses whenever possible and let profits accumulate.UnsuitabilityThe NASD requires that a stockbroker “recommend a purchase or sale only after determining that the recommendation is suitable for the customer.” The NYSE requires that a broker “know his customer before recommending securities.” Suitability is based on a customer's age, income, net worth, education, stated investment objectives and prior investment experience and investment goals. The broker must have an intimate knowledge of the client’s risk tolerance as well, and propose and execute investments that are consistent with the client’s objectives. A broker has a duty to only recommend investments and trading strategies that are suitable for that client. An investment may be deemed unsuitable if a customer does not have the financial ability to incur the risk associated with a particular investment. For example, if you told your broker that you wanted low risk and your broker chose aggressive, high risk investments you may be able to recover money that was lost. Also, if your broker chose investments that didn’t meet your investment objectives or time frame and you lost money you may be able to recover your money.Call Stockbroker Fraud Attorney - Craig Weintraub 216-896-9090Mutual Fund, & Annuity SwitchingSwitching of annuities or mutual funds involves a recommendation by a broker to sell a particular group of mutual funds or annuities and repurchase a nearly identical instrument for the investor in order to generate a large commission. Typically, the broker will not disclose any the commissions or incentives that will be received by the broker.Over ConcentrationThis is the lack of diversification or over concentration of a position in a portfolio. If a portfolio contains one or two particular stocks or one or two particular industry sectors such as technology or financials, the risk increases losses can occur very quickly.Unauthorized TradingIf you have a non-discretionary account, a broker is not permitted to make transactions without your knowledge or approval. The date of a transaction is the most important evidentiary factor in relation to the time of the complaint of the trade. Brokers also have an obligation to follow your instructions regarding when and at what price they need to buy or sell stocks on your behalf. In order to prove this claim the broker’s notes will be reviewed to see if you were contacted prior to the trade(s) that you contend you did not authorize. If the broker did not keep detailed records pertaining to trades and communications with you then breach of fiduciary duty issues will be raised.Material Misrepresentations or OmissionsIf you were misled by your stockbroker or your broker failed to disclose material facts about an investment, you may have a claim for misrepresentations or omissions can arise. Often these misrepresentations or omissions obscure or downplay the risks associated with a particular investment. A broker has a duty to fairly disclose all of the risks associated with an investment. Brokers are also required to provide a fair and balanced presentation, allowing clients to assess risk and reward before exposing their money to the market.Senior Citizen Alert!We Can Recover Your MoneyTo recover losses an investor must file a claim for recovery. Most claims against brokerage firms must be resolved in securities arbitration hearings instead of a courtroom because of account agreements that require you to arbitrate the claim. We meet with you and gather your information and review your supporting documentation. We recommend the course of action we will take. We commence settlement discussions with the brokerage firms that employed the broker and if it cannot be resolved swiftly we pursue mediation of file an arbitration claim before NASD Dispute Resolution, Inc. or the New York Stock Exchange, presently known as FINRA Dispute Resolution, Inc.Call Stockbroker Fraud Attorney - Craig Weintraub 216-896-9090What is Arbitration?Most securities brokerage firms include arbitration clauses in their customer agreements. Arbitration clauses require that disputes be resolved in arbitration before the such as the National Association of Securities Dealers (NASD) or the New York Stock Exchange (NYSE- FINRA). The arbitration procedure can be advantageous for an investor because it reduces the time period that a case would typically be heard in a courtroom.The Regulatory Role of the SEC and NASDThe SEC and NASD are charged with enforcing laws and cannot recover your losses. If they determine that wrongdoing occurred they will only impose fines and reprimand the brokers.National RepresentationBecause of our alliances with firms throughout the United States, we can handle securities arbitration claims anywhere in the United States.If you are a victim of stockbroker fraud, call us 216-896-9090. We can help.
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