Common Investment Advisor Misconducts in North America

May 01 16:11 2017 Print This Article

The importance of an investment fraud attorney cannot be over-emphasized if you have ever suffered losses due to securities fraud. While it’s the responsibility of the financial advisor to advise you on financial matters and investments, they can breach this fiduciary duty and at the same time go against their ethical and legal responsibilities. Among the most experienced investment fraud attorney in Los Angeles is Investor Defense Law. This firm and other firms of the sort will represent you whenever your advisor breaches the confidentiality agreement. Common misconducts that an investment attorney will represent you include:

Investment Advisor Misconduct
Some of the misconducts that a financial advisor may engage in include negligence where they fail to follow the set standards when it comes to offering their services. Fraudulent and criminal activities such as embezzlement, forgery and theft can be another ground for securities misconduct. A financial expert can also be sued if he/she recommends an investment that is not suited to the client’s portfolio. This depends on the client’s financial assets, their age as well as their family situation. If a client suffers considerable loss and it’s proven that the financial advisor failed to diversify the client’s portfolio, the advisor will be subjected to a lawsuit. Omissions and misrepresentations on the side of the advisor can be ground for a lawsuit.

Other misconducts that may come along during the practice include failing to follow the instructions of the client, high pressure tactics that results to the client making premature decisions and stock manipulation. Stock manipulation is the practice where the advisor interferes with stocks for his personal gain.

Reporting an Investment Fraud
Whenever you feel like you have been a victim of investment fraud, there is a procedure that you should follow to ensure that the issue reaches the relevant authorities. The first step in this case is creating a fraud file. This is where you collect and store relevant information about you claim. Important documents you should have in this file include evidence of the fraud, a police report, credit report concerning the fraud as well as timeline of the whole interaction with the perpetrator. It should also contain relevant information about the perpetrator such as their name, email address, telephone numbers and physical address. The file should also contain logs of the phone conversations that took place between you and the perpetrator. You can also present the notes that they gave you during your time together.

The second procedure in reporting any form of misconduct involves getting to know your rights. There is law that favors you or some rulings that have been made by federal judges that may favor you. If your case is a federal case, you can refer to the US Department of Justice for your rights. If it’s a state case, you will have to deal with the attorney general in your state. In this field, there are regulators who handle these cases and they include Financial Industry Regulatory Authority, North American Securities Administrators Association as well as the National Association of Insurance Commissioners.


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