Lawyers Protecting the Rights of NYC Investors Harmed by Broker Fraud and Negligence
Representing investors in the Empire State and throughout the country
When you invest your money with a broker, there will always be some element of risk. However, if you are experiencing mediocre returns and/or significant losses, you might have options available to you to recoup those losses. When stockbrokers fail to uphold their responsibility to their clients, that can result in a cause of action for negligence.
At The Frankowski Firm, we stand up for our clients who have experienced devastating financial losses because of broker negligence and fraud. Our firm’s founder, Richard S. Frankowski, has been fighting to protect the rights of individual investors who have suffered losses because of corporate greed for 15 years. We have experience bringing securities arbitration claims and civil actions against brokers and brokerage firms.
What is the difference between negligence and fraud?
Negligence, as that term is used in securities law, occurs when a broker or brokerage firm fails to meet the industry’s standards of care for advising customers and handling their accounts. Negligence does not require intentional harm to a client, but means simply that a broker, supervisor, and/or brokerage firm failed to behave reasonably with respect to a client’s investments.
Fraud, on the other hand, involves an intentional misrepresentation or omission designed to financially harm the customer while benefitting the broker or brokerage firm. Negligence and fraud are each legally actionable and investors who have fallen victim to fraud or extreme neglect may be able to recover punitive damages as well as recouping their investment losses and the costs of their legal action.
Examples of common claims brought against brokers by investors
The following are a few of the various legal causes of action that investors can file against NYC brokers and the brokerage firms that employ them:
- New York Blue Sky law violations. Blue sky laws are state laws which impose standards for offering and selling securities, which aim to protect individuals from fraudulent or overly speculative investments. (LLI) If your broker sold you unregistered securities in the state of New York, you may be able to pursue a legal claim.
- Breach of fiduciary duty. Your advisor owes you a fiduciary duty, which means being bound ethically to act in the other’s best interests. A breach of fiduciary duty may give rise to a negligence claim.
- Breach of contract. There are many situations which might give rise to a cause of action for breach of contract, including mismanagement, failure to follow the customers instructions or the broker’s failure to act in good faith on the client’s behalf.
- Suitability claims. The client relies on the broker’s expertise, and trusts the broker’s judgement in choosing investment vehicles that are appropriate and suitable. Brokers and advisors who make unsuitable recommendations can be held accountable for their negligence.
- Failure to supervise. Brokerage firms have a responsibility to supervise the people who work for them. When a broker is negligent or commits fraud, the investment firm may be held liable for the wrongful acts of their employees when they are acting within the scope of their employment.
- Churning is the act of repeated trading and selling to generate more commissions. You may not notice a difference in how much money you have earned or lost, but too much activity is usually an indicator of this practice.
- Ponzi schemes. If your broker or advisor has rushed you into a decision about trades, is difficult to track down, offers little to no information about your investments, is not associated with a reputable firm, or displays any number of “red flags,” you might be the victim of securities fraud.
- Selling away. “Selling away” is the practice of selling securities that are not approved by the brokerage firm, and it is prohibited by law.
- Misrepresentations and omissions. Any type of scheme to misrepresent or omit material facts regarding the purchase or sale of securities violates SEC laws and state laws and may provide a cause of action against the broker engaged in such practices.
- Unauthorized trading. If a broker does not have authorization from a customer, they are prohibited from exercising trades.
The Frankowski Firm represents victims of securities and investment fraud and negligence. The firm aggressively pursues recovery from negligent brokers and brokerage firms. Whether we pursue a claim through FINRA arbitration, or litigate the case in state or federal court, you can rely on the proven excellence and skill of a team of securities and investment fraud attorneys who offer honest answers, personalized attention and optimal results for you.
Schedule a consultation with skilled securities fraud and negligence lawyers now
Taking a massive loss on your hard-earned money can deal a crushing blow to your dreams and plans for the future. If you believe that you have a claim because your investments have failed to make even a reasonable return, our investment fraud attorneys are here to listen to you and offer sound legal advice. The Frankowski Firm wants to help if you were the victim of fraud or negligence by a New York City stockbroker or advisor. To schedule an appointment in the New York City area, please call us at 888-741-7503 or complete our contact form.