Investment Negligence & Fraud
Investment Fraud Attorneys
The main focus of the legal practice at the New York firm of Meissner Associates, is representing the public investor in securities arbitration matters. The firm comprises an able team of investment fraud attorneys that also handles employment matters for securities industry employees and other securities issues.
Many of the securities claims cases pursued by the Meissner firm’s investment fraud attorneys on behalf of investors are suitability cases, in which a stockbroker provides advice that is unsuitable to an investor’s situation. However, in the last two years the firm has investigated and successfully initiated claims against large financial institutions involving specific “products” or investments in which investors were misled with regard to the supposed safety and security of various investments. Examples of investments that were marketed as “safe” are Fannie Mae / Freddie Mac preferred stock or Auction Rate Securities or Principal Protected Notes of Lehman Brothers, sold and improperly marketed by various investment banks such as UBS and others. In some cases even the broker was misled by their own firm. One such case reported in the Wall Street Journal in September 2008 the Meissner firm successfully assisted a client whose own son sold him the initial securities because the broker himself was misled and sought out the Meissner firm to assist his father in recovering 2.5 million dollars of funds frozen in Auction Rate Securities. To review some of the matters we are currently investigating and/or filing claims over click here.
Contact the Meissner firm to consult with our investment fraud attorneys if you are the victim of a broker who has invested your funds in unsuitable investment vehicles.
Call 212-764-3100 for a free case evaluation or
Typical Securities Arbitration Cases Can Involve:
- Unauthorized Trades – the broker, without written discretionary authority having been provided, executes transactions without authorization immediately prior to each trade as required under various securities regulations. Contrary to many people’s belief, in the typical brokerage account (non-discretionary) a broker must obtain explicit authorization from the client immediately prior to each transaction otherwise the transaction is considered “unauthorized”. Such transactions can also impact upon and heighten a broker’s fiduciary obligation to its client leading to additional liability.
- Risk Profile Change – broker has changed your investment strategy without your input. An example would be to change your investment profile or objective from conservative to aggressive.
- Over-Concentration of Account(s) – Often times broker recommendations result in an over-concentration of one’s investments into one sector such as oil, one stock such as Mobil, or one type of investment such bonds, which concentration is unsuitable and causes extreme losses in one’s account when that sector, stock or type of investment collapses, and forms a basis for a valid claim. In 2015, for example, Oil and Gas Master Limited Partnerships and Oil stocks, such as Linn Energy collapsed due to the collapse in the oil sector. Many investors who sought high yields often were over-concentrated in such MLPs or stocks in order to obtain regular income. Risks of such over-concentration were often downplayed by inexperienced advisors who were short sighted. As a result, many senior citizens and investors depended on their investment accounts were significantly hurt.
- Excessive Use of Margin – broker recommends and/or engages in excessive and unsuitable use of margin significantly increasing the risk to the overall account leading to large unsuitable losses and/or not fully explaining such risks to the client or a broker may suggest the use of margin, suggesting that the investor take out a home-equity line of credit to cover a margin call. A subsequent margin call could result in the investor losing their home.
- Fraudulent Stock Research – broker provides fraudulent stock research. “88% Recovery Merrill Lynch Research Case” Money/Morningstar, February 24, 2005: FINRA
- Churning – broker excessively trades or constantly turns over your account, for the purpose of generating brokers’ commissions.
- Negligent Retirement Advice – broker provides unsuitable speculative recommendations to a retiree resulting in the loss of their nest egg. “Meissner Merrill Lynch Award” – Sunday NY Times 08/10/03
- Mutual Fund Switching – broker advises you to get out of one mutual fund or variable annuity and into another when it is not in your best interest. This is done in some cases for higher broker commissions.
- Unsuitable Annuity Products for the Elderly / Senior Citizens – broker recommends an annuity product to an elderly person. A broker can realize a significant profit from the sale of an annuity, but such a product is generally inappropriate or considered unsuitable for an elderly investor.
- Negligent Employee Stock Option Advice – broker fails to advise to sell and diversify or to properly collar or hedge. Two examples of the Meissner firm’s Employee Stock cases are found on the following links.America Online Employees Related to Their Employment Stock and Their Former Morgan Stanley D.W. Broker“Banc of America Securities Ordered to Pay N.J. Couple $840,000” Forbes.com, April 28, 2004 Related to their former broker, Richard Zinman
Broker & Corporate Malfeasance
Other examples of broker or corporate malfeasance, such as fraud, broker negligence, embezzlement, market manipulation, and insider trading, may require litigation in state or federal court. Stuart D. Meissner has significant experience as a trial attorney and is able to represent his clients effectively in court as well as in arbitration.
The Meissner firm has represented individual investors in many other matters in arbitration before the FINRA, including unsuitable speculative investments and misrepresentations or omissions in describing the investments. For an experienced securities arbitration law firm, contact Meissner Associates. The firm has handled securities arbitration cases from across the United States and around the world. Click here to learn more about securities arbitration.